Domestic clean fuel provider ENN Group announced on Friday in Beijing the formation of a joint venture project specializing in distributed energy development with Schneider Electric, a global specialist in energy management.

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As the Chinese government continues to make great strides in improving the country's air quality and reforming its energy industry, the distributed power generation sector is expected to have big market potential.

Facing these new opportunities, the joint venture formed by ENN and Schneider Electric will focus on distributed energy development and related businesses.

By 2020, the natural gas distributed power will reach a total installed capacity of 50 million kilowatts, according to industrial statistics.

ENN, based in Langfang, Hebei province, started its business through natural gas distribution in the 1980s.

By the end of 2013, ENN's total assets were valued at more than 80 billion yuan ($12.83 billion) with businesses in natural gas, solar, petrochemical and energy distribution.

Wang Yusuo, ENN's chairman, said China's energy industry has entered a rapid transformation period and therefore a highly efficient integrated modern energy system is needed.

Wang said the two partners will find a way to contribute to this emerging trend.