BEIJING - China's renewable energy and clean technology industry saw strong investment momentum in the first quarter of 2016 as the government ramped up efforts to develop a green economy, according to a new report from PwC.

A total of 31 private equity or venture capital investments were made in the period, up 106.7 percent year on year. The disclosed investment sum reached $657 million, increasing 425 percent compared with Q1 2015, said the international accounting firm.

Twenty of the investments were made in the environmental protection sub-sector. The majority were made in either expanding or mature businesses.

The National Development and Reform Commission issued Guidelines for Issuing Green Bonds in January, clarifying that green bonds will provide support primarily in 12 areas including energy conservation and emission reduction, as well as green urbanization.

"Attention should be paid to the fact that China's renewable and cleantech investment is occurring at earlier stages. In Q1 2016, while most of China's renewable and cleantech investments took place in the A and B rounds, activity in the Pre-A and angel rounds, though still minor, reflected investor optimism in these early investment rounds," said Lisa Wang, PwC China power and utilities partner.

As a consequence of fluctuations in China's capital markets, no IPOs occurred in Q1 2016 in China's renewable energy and cleantech industry. However, enterprises from various sub-sectors are lining up to list, and around a dozen have begun the pre-disclosure process, according to the report.

It said 46 renewable energy and cleantech enterprises were listed on China's over-the-counter exchange for small firms, the National Equities Exchange and Quotations (NEEQ), in Q1 2016.

These firms selected the NEEQ because they are not qualified for IPOs due to their limited scale. Meanwhile, as the NEEQ acts as a valuable source for funding for renewable energy and cleantech enterprises, it is popular with medium-and-small-sized firms in this sector, said Gavin Chui, PwC China energy, utilities and mining industry leader.

"With the rise of the slicing scheme by the NEEQ, as well as other continuous improvements, we believe that an increasing number of promising renewable energy and cleantech enterprises will list on the NEEQ," Chui added.