China 5-Year Plan (2011-15): solar capacity 21M kilowatts
Solar industry seeks light at end of tunnel
Updated: 2013-01-14 05:49
By Du Juan (China Daily)
Workers checking the quality of solar panels at a PV solar factory in Jiangsu province. For the Chinese solar industry, the path to its largest overseas market - Europe - is increasingly narrowing because the European Union has started anti-dumping and anti-subsidy investigations on made-in-China solar products. Provided to China Daily
Trade disputes causing damage to all and bringing about big changes
The solar trade disputes between China and Europe triggered increasing attention globally in 2012 and will continue to bring deep changes to the industry.
"The trade conflicts in the photovoltaic solar industry between China and Europe should end as soon as possible because it is bad for everyone," said Reinhold Buttgereit, secretary-general of the European Photovoltaic Industry Association.
The Chinese government has made efforts to help the solar industry by expanding the domestic application of solar power plants and encouraging the distribution of solar power generation.
Starting in November, China's largest utility company State Grid began to provide a free service that allows PV solar power producers to connect to the national grid, a move considered "very encouraging" by industry experts.
"The biggest obstacle for China's new energy industry is the on-grid problem. The new policy will solve it to a certain extent," said Meng Xian'gan, deputy director of the China Renewable Energy Society.
According to the new policy, the State Grid branches at city level will have the rights to approve distributed solar power plant projects with installed capacities of less than 10,000 kilowatts each to be connected to the grid. Distributed solar power plants are self-supporting small scale units that have the ability to sell excess capacity to the grid.
Meng said the new plan shows the government's determination to support the domestic solar industry. It was echoed by the State Council's official statement of supporting distributed power generation on Dec 19.
Distributed solar power generation plays a major role compared with the integrated power generation in developed countries including most European countries, the US and Japan, according to Wang Sicheng, a senior researcher at the Energy Research Institute.
He said the cost of electricity transmission in western China, for example, is high because of the long distances involved. Distributed power plants therefore have advantages by saving costs.
China's PV solar market will develop at an annual growth rate of about 20.2 percent over the next few years, Wang predicted. Meanwhile, the share of distributed solar power generation among the overall solar market will grow from 30.3 percent in 2011 to 45.24 percent in 2015.
"The current overcapacity problem in the global PV solar market is temporary, lasting just a few years," he said. "The demand in the market will grow by a large extent after about five years."
The Chinese government is not the only one supporting the PV industry across the world.
The US government provides tax breaks for homes or businesses supporting the domestic solar PV market, according to a report from GlobalData, an international business intelligence organization that focuses on energy, resources and healthcare sectors.
It said between 2009 and 2011 the US Treasury provided 3,731 grants for solar power projects, amounting to a total of $1.56 billion, for the installation of solar power projects equivalent to 1,290.64 megawatts.
The US government has also increased spending on PV in federal buildings and the defense sector, investing in PV equipment for military power supplies and the government sector, the report said.
Currently, the solar PV module market in North America is dominated by the US, which accounted for more than 85.3 percent of regional additions in 2011.
Many foreign experts believe Chinese companies will survive the crisis.
"It's easier for Chinese companies to beat the competition," said Buttgereit. "In the EU it is impossible to get loans from banks because of the bad economy there."
He said the debt crisis and weak economy is a much tougher issue in Europe than PV industry problems and some companies will not survive - a natural outcome of market economics.
He believes that China will become the biggest PV solar player in one or two years.
In the Chinese government's 12th Five-Year Plan (2011-15) on the energy industry, it states the country will reach a total solar power installation capacity of more than 21 million kilowatts by the end of the plan period.
(China Daily 01/14/2013 page13)