HUADIAN Power International Corp, the fourth-largest Hong Kong-listed Chinese electricity producer by market value, will form a venture with its parent to invest in "environmentally friendly" energy projects.

Huadian Power will own 20 percent of the venture, parent China Huadian Corp will hold 51 percent, and units of China Huadian will have 29 percent, according to a company statement to the Hong Kong stock exchange. China is formulating policies regarding the proportion of power to come from new energy sources and will require power firms to devote a certain percentage of their installed capacity to these generation methods, the statement said.