Chinese PV aspirant Tongwei Group has today broken ground on what it claims will be a 5 GW solar cell production facility in western China, which once complete will be the largest cell fab globally.
Located at an 80-hectare site on Chengdu, the facility will triple Tongweis solar cell manufacturing capacity, which is set to rise to 2.4 GW by the end of this year, reports Bloomberg.
Having secured a 10% stake in Taiwans cell producer Gintech Energy earlier this year, Tongwei has communicated that it is ramping up its cell production capabilities to rival its output of polysilicon. In September 2013 the company purchased troubled Chinese solar firm LDK Solar for a reported RMB 870 million (US$137 million), a move that first brought the conglomerate into the solar cell industry. Tongwei has been a market leader in the agricultural feed sector in China for 20 years, but it claims to be moving strongly into solar.
Chinas JA Solar is currently the worlds largest PV cell producer, with 1.1 GW of cell and module shipments achieved by the company in Q3 2015. It aims to reach 4 GW of cell production in 2016 with expansion plans including a 400 MW cell facility in Malaysia.
While todays groundbreaking ceremony is guaranteed to capture headlines, analyst Finlay Colville councils caution when interpreting such bold capacity announcements.
There are still question marks at to what kind of utilization rates can be achieved and where the demand is coming from for this extra 5 GW, when Tongwei doesnt appear to have any global footprint, said Colville, the head of Market Intelligence at Solar Media.
5 GW announcements tend to be a little bit hard to accept as opposed to stage expansion phases that get to 5 GW. Even top producers with regards to expansion plans next year are looking to increase capacities from 4 GW to 5 GW, so to have an expansion plan straight to 5 GW reminds us a little of Hanergy.
Colville noted that with the increasing importance and size of the Chinese downstream market presents difficulties when tracking production volumes in China for firms that do not export product.
China is such a big market so there are a lot of companies now that have no exposure outside of China, said Colville. So there are a lot of manufacturers with non-unsubstantial capacities, around 500 MW to 1 GW, with only internal Chinese consumption. So in China its possible to see large expansion plans without product being shipped overseas. But in saying that, 5 GW does seem rather big.
Colville added that there have been none of the standard announcements from Tongwei as to its production regarding utilization rates, R&D programs, cell efficiencies, nor module powers. There arent the usual reference points that we see from the major players.
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