Despite predictions of a late surge in solar installations in China this year, driven by the publication of new subsidy guidelines, there are signs the world’s biggest solar marketplace may experience another precipitous year-on-year decline.
Wang Bohua, chief secretary of the China Photovoltaic Industry Association (CPIA) said on Thursday in Beijing, PV installation in the past nine months added up to only around 16 GW of generation capacity. The National Energy Administration (NEA) this morning confirmed only 4.59 GW of new solar was added in the last quarter, to take China to a cumulative 15.99 GW to the end of last month. That means even the most pessimistic new capacity predictions for this year – that China would add 30 GW of new solar – will require more than 14 GW of new project capacity in nine weeks to appear anything other than wildly optimistic.
The industry is telling a similar story. The lack of a predicted solar rebound, which was supposed to kick-off last month, has left solar prices at rock bottom, with ten weeks of falling PV cell prices between early June and September followed by module declines since August.
Companies look elsewhere
“[An] overseas markets boom saved the sales of Chinese manufacturers from getting worse,” said the head of marketing of a leading solar panel maker, who was speaking anonymously. Major module manufacturers are lowering their shipment expectations for the second half as well as their annual figures.
The delay until June of the formal adoption of new rules for solar subsidies forced many small and medium sized engineering, procurement and construction services companies to look overseas for business or to turn to wind power development, which offered more stable business while Chinese solar policy was in flux.
At the beginning of the year, the CPIA was predicting 35-45 GW of new solar capacity in China this year and other analysts were more optimistic. Short of a miraculous, Vietnam-style solar gold rush before year-end, that figure now looks set to be south of 30 GW, which itself would constitute a 30% year-on-year fall after a 20% retreat last year. That would be the very definition of a cliff-edge decline.
This morning’s update from the NEA revealed 7.73 GW of the solar capacity added this year came in the form of ground-mounted projects with small arrays providing 8.26 GW. Solar energy output rose 28.1% on the figure recorded in the same period of last year because capacity utilization rate rose 6.2% and the volume of solar electricity curtailed to prevent overloading the grid fell 1%.