Global industry collaboration key focus for China

20. March 2012 | Markets & Trends, Global PV markets, Top News | By:  Becky Stuart

At the opening of Solarcon and Semicon China 2012, global industry collaboration was highlighted as a key path forward for the industry. Allan Lu, president of the event organizer SEMI, further stated that the need for energy in China is driving photovoltaic growth in the country.

A ground-mounted solar system in China.

The message from the Solarcon China conference was that energy demand is a key driver of photovoltaic growth in China.

While over 50,000 visitors and 2,500 exhibitors are expected at the three day event, which opened its doors today in Shanghai, China, it was clear that the majority will be attending the semiconductor show, despite the strong emphasis that has been placed on the county's burgeoning solar industry.

At the Grand Opening Keynotes, it was said that industry development depends on collaboration, both across supply chains and regions. This sentiment was echoed by many of the exhibitors on the trade show floors, despite the lack of quality visitors present.

It was also said that the photovoltaics industry in China has grown considerably and that many domestic companies are "rebounding" from the global recession seen last year. The esteemed Professor Martin Green from Australia's University of New South Wales and honorary chair of the China photovoltaic technology conference went on to underline the "great synergies" that exist between the semiconductor and solar industries, which have been "of great benefit to all".

China's electronics industry was additionally praised for its development into a "growth engine"; it was said that solar has become a very important part of that development, and that it is "vital" to its further promotion, restructuring and rapid growth. Furthermore, it is crucial to improve the industry by encouraging research and development.

As aforementioned, the exhibition halls in Solarcon were relatively empty in comparison to the hustle and bustle seen on the semiconductor side. And, while there were a few of the big Chinese players present - Suntech, LDK Solar, Astronergy and Trina Solar, for example - the lack of high end management was evident.

Newcomers

Many exhibitors also complained that while there were a few visitors in the halls, the quality was not high in terms of potential business generation. As one, who wishes to remain unnamed, bemoaned, "I wish we hadn't spent so much on the stand". Another commented that the traffic simply wasn't interesting.

That being said, there were a few newcomers on the scene. Of particular note was NuvoSun, a new CIGS manufacturer, which is currently based in California's Silicon Valley. With financial backing from Dow Chemicals, it could become an interesting player in the solar industry.

Keith Cheung, general manager of equipment operations told pv magazine that while the company is based in the U.S., it will be moving its operations to China, probably later this year.

Currently, the company has one production line for its CIGS modules, at a capacity of between 40 and 50 megawatts (MW) in the U.S. However, all future equipment and panels will be procured in China, and a line will be established for process development. He added that the equipment is self-designed and, while the process and concept comes from the U.S., the engineering and materials purchase will take place in China, as this helps to keep costs lower.

NuvoSun is targeting an efficiency of 14 percent and expects manufacturing costs to be around US$0.50 per Watt. It employs a roll-to-roll technology, which uses stainless steel micron film and a continuous production process, as opposed to a batch process.

Another newcomer to the Chinese solar scene is Parc, an R&D company and subsidiary of the Xerox Corporation. Scott Elrod, vice president and director of the hardware systems lab explained that the company is focused on the cleantech industry, and works with companies in Europe, the U.S. and Asia. Parc specializes in advanced cell architecture, and particularly focuses on photovoltaic cell printing, metallization, grid lines, laser processing and point contacts.

Thus far, he said a couple of conversations had taken place with Chinese companies, however it is too early to say how successful the Solarcon event will be. He strongly believes that the "horsepower of the PV industry" is in China.

Looking to the future, he said that Parc is looking into interdigitated back contact cells, which have the promise of producing cells with efficiencies of between 22 and 24 percent, and production costs of around $0.10 per Watt (in China). The low cost is said to be due to a reduction of process steps from 17 to 12.

Project development

When asked why Suntech had decided to attend Solarcon, Aaron Chen replied that although there are few sales opportunities, it is a good place to meet with government officials and talk about cooperation activities; something that Astronergy's Wanshu Hu also confirmed.

Both companies said they were aggressively pursuing project development, particularly in western China, although they declined to divulge any concrete details. Hu added that for Astronergy it was relatively easy to obtain loans and financing, due to its good reputation and long history in China.

In terms of project costs, he said that for ground-mounted projects, installation costs are about 15 RMB ($2.37) per Watt; rooftop is somewhat more expensive, depending on the panels used. For its upcoming projects, Astronergy will apply for a loan under the Golden Sun Program. Hu went on to say that there are difficulties with grid connection, but that could not expand as it was "too sensitive" to talk about.

Meanwhile, he was of the opinion that it is not difficult for foreign developers to enter the Chinese market, and pointed to the companies, like Wirsol, which have achieved this, having built up good relationships with state owned companies. ReneSolar's Anthony Hung also confirmed this view.

Hung, who is a Vice president at ReneSola and met pv magazine after the show, further said that ReneSola is beginning to "cautiously"  focus on the project development business. The company is currently finalizing a "little" 20 MW project in China, which it is hoping to sell. Funded by ReneSola, it is still waiting to be grid connected and does not yet have a power purchase agreement. In terms of further projects, both Eastern Europe and China are interesting, although no concrete details have been released. The company is in general talks with Deutsche Bank, however, and has met with vice president Felix Holz to discuss bankability.

Hung believes that there is a danger that the Chinese photovoltaic project industry could go the same way as the country's wind, i.e. with low margins,  overdeveloped, and grid connection problems. In terms of project financing, he said that the Chinese banks are willing to lend to the companies, but not the projects.

He went on to say that the company has recently refocused its strategy to be more international. Until eight weeks ago, he explained, ReneSola had 8,000 workers, only a handful of which were European. In order to redress the balance, and to capture foreign markets, it is hiring more people outside of China and expanding its sales force. Europe, and specifically Germany, still represents the lion's share of ReneSola's sales, while only a handful of products were sold into the Chinese market in 2011.

In terms of manufacturing, ReneSola has a wafer capacity of just over two gigawatts. Hung added that the company's mono wafers are selling for $0.37 per Watt, while its quasi mono wafers are going for between $0.33 to $0.35 per Watt. It is also focusing on polysilicon production and, at 4,000 MT, has already overachieved its original phase one target of 3,000 MT. Phase two is in the works and ReneSola hopes to hit 10,000 MT by the end of the year.

Photovoltaic cell and module capacity is currently running at 240 MW, and between 400 and 500 MW, respectively. Hung said that "significant" module capacity expansion could be in the pipeline in 2012, but before announcements can be made, it needs to assess the market conditions. If the expansion took place, the company would need to extend its facilities at Wuxi, in China.


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