A photovoltaic panel production line in Jiangsu province. [Photo/China Daily]

China is considering policies to boost domestic solar power demand to rescue an industry that's battling with excess output capacity and anti-dumping action from the West.

The National Energy Administration recently asked all provinces to submit by October 15 their plans on implementing a pilot program for the so-called distributed photovoltaic power generation, the China Securities Journal reported Wednesday.

Distributed generation, also called decentralized generation, generates power from many small energy sources and may have a lower environmental impact. China has said it will support the development of distributed power generation.

Shanghai, Beijing, Tianjin, and other coastal provinces will implement the distributed solar generation pilot program, the newspaper said.

China's solar industry, heavily reliant on exports, has been suffering from oversupply which led to cuts in panel prices and jobs. Also, the European Union this month decided to launch an anti-dumping probe on Chinese solar products.

China exported around 21 billion euros ($26.99 billion) worth of solar panels and their key components to the EU in 2011, according to EU statistics.

(Shanghai Daily contributed to the story)

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