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Mingyuan Garden is like many other residential communities in the northern suburb of Xi'an, capital of northwest Shaanxi province.

But Mingyuan shines out in one major aspect - 81 rooftop solar panels power all its public lights.

With about 0.6 kWh electricity generated by one solar panel every day, the overall electricity generated by the panels is enough to meet all the energy demand for the community's public lighting system.

Apart from residential areas like Mingyuan, similar solar-powered lights are seen on the streets in Xi'an, proving that clean energy is already playing an important role in the urbanization of the capital of Northwest Shaanxi province.

A complete photovoltaic (PV) industry chain is also taking shape in Xi'an High-tech Industries Development Zone and the former ancient capital of 13 dynasties is working to distinguish itself as China's new capital of solar research and development.

"Xi'an High-tech Zone has taken the initiative to develop the PV industry in Northwest China by listing it as a pillar industry," says Wang Dong, deputy director of the bureau of economics and trade development of the administrative committee of Xi'an High-tech Industries Development Zone.

The electricity converted from solar power is considered to be inexhaustible and environmentally friendly, with zero emissions. It is regarded as one of the most important clean energy sources of the 21st century.

Countries around the world have stepped up efforts to develop this sunrise industry and accelerate the construction of PV power plants.

The green wave has swept Shaanxi, prompting the Xi'an high-tech zone, a key State-level high-tech R&D and production base with an annual production value surpassing 300 billion yuan (32.7 billion euros), to take the lead.

"Most PV technology derive from the semiconductor industry and the Xi'an high-tech zone is originally a regional hub for semiconductor manufacturers, so we have an absolute advantage in developing PV solar technology," Wang says.

"The development of the PV industry in the zone is vital to the overall development of the solar industry in Shaanxi and the entire western region."

The zone has brought together 37 domestic and foreign PV enterprises engaged in all sectors of production and manufacturing, which help form a complete PV industrial chain within the area.

The promising prospects of the PV industry in western China have also drawn multinational companies to seek a foothold in Xi'an.

Applied Materials Inc, the world's largest supplier of equipment used to make semiconductors, solar panels and flat-panel displays, has put into operation its global development and research center in Xi'an high-tech zone in October 2009.

With a total investment of $300 million (211 million euros), the center, covering an area of 40,000 square meters, is said to be the world's largest non-government solar energy research facility. Its completion marks the largest foreign investment in industrial projects in Shaanxi over the past 20 years.

Employees in the center work closely with local suppliers to test and qualify new materials and tools, and to evaluate potential cost-saving technologies.

"The center positions us strategically to benefit as growth continues throughout China, particularly in the west," says Zou Gang, vice-president and China chief technology officer of Applied Materials.

He explains that China's northwestern areas are able to tap solar energy resources more than the eastern coastal areas due to abundant sunshine. Xi'an, the economic hub of Northwest China, is an ideal location for Applied Materials to tap that potential.

Xi'an's rich talent resource is another big incentive.

"Xi'an has many prestigious technical universities, making it easier for us to seek collaboration opportunities on cutting-edge technologies and attract quality employees."

"We believe the center's establishment is a cornerstone of our growth strategy throughout China and even the whole world," Zou says.

A number of Xi'an based semiconductor silicon wafer suppliers in the high-tech zone are also becoming major players in the domestic PV market.

"The photovoltaic and semiconductor industries are competing for silicon wafers today," says Li Jianjun, general manager of Xi'an Huajing Electronics Technology Co Ltd, which is one of China's biggest enterprises dealing with the R&D and manufacturing of silicon wafers, a key material used in solar cells and semiconductors.

In 2009, Huajing invested 360 million yuan in Xi'an high-tech zone to build a new silicon wafer processing base, which has helped the company to achieve 608 million yuan in sales revenue last year.

"Many domestic solar companies are anxious for success, but with the policy support given to new energy enterprises from the high-tech zone, we have a good environment to develop our business," Li says.

According to the 12th Five-Year Plan (2011-2015) for the development of the solar PV industry in the zone, the industry will achieve an annual production value of 100 billion yuan by 2015 to become one of the engines of Xi'an's economic development.

"We will focus on the design of PV power plants and PV technology innovation in the next five years to sharpen our competitive edge in the market," Wang says.

The high-tech zone will continue to offer preferential services to PV enterprises in taxation, land use, professional training and business incubation, and more leading PV enterprises are welcomed to open their bureaus in the district, he says.

"We aim to build a first-class PV industrial base in China, which is poised to become a key source of solar innovation," Wang says.