China: PV still at “take-off” stage

CCID Consulting says there is “significant” potential for market demand in the country, but goes on to state that it currently has a low added value due to “restrictions” on core technologies and “limited” state supports.

Consequently, the company believes investors of the upper stream of the industry chain should have a strong research and development capability, while those of the lower stream should pay close attention to the state’s policies.

Furthermore, it says that in the upper end of the chain, the PV sector primarily relies on imports for polysilicon supplies, “due to limited domestic production capacity” and in the middle part of the chain, 95 percent of the solar batteries are produced for export. Meanwhile, it states that PV component production at the end of the industry chain “faces over capacity and low profit margins due to insufficient investment and low technical content”.

“Policy and economy risks are significant because, judging from the development of the international renewable energy industry, it relies heavily on governments’ policy supports for its advancement, “ comments Wang Xiaoning, consultant with CCID Consulting’s Energy Industry Research Center.

The company says market risks include difficulty in market access, the industry’s life cycle, as well as products’ competitiveness and growth capacity.