China turning excess solar energy inward

Want China Times, Staff Reporter, 2012-09-30

China's photovoltaic industry, which has been trapped by anti-dumping cases
 from its major importers, is looking to China's domestic consumption to absorb
the excess production of electricity. (Photo/Xinhua)

China's government agencies are formulating a series of measures to help the solar photovoltaic market, aiming at an increase in total installed photovoltaic capacity to 10 million kilowatts by 2015, China Securities Journal reported.

China's National Energy Bureau recently issued a notification, directing various provinces, regions and cities to file their respective plans for developing distributed photovoltaic-power applications and the locations where they would be demonstration before Oct. 15.

The notification caps the number of photovoltaic power generation systems in any single region or city at three, and total installed capacity at 500,000 kilowatts. This means the total capacity of distributed photovoltaic power generation systems in various cities and regions of the country's 31 provinces may exceed 15 million kilowatts during the initial period.

The implementation areas for these projects include Beijing, Tianjin and Shanghai. The government will provide subsidies for the implementation of these projects and to users of these projects.

Meanwhile, the Ministry of Industry and Information Technology is planning to set up entry barriers for photovoltaic enterprises entering the market.

Under the solar energy development project of China's Five-Year Economic Development Plan (2011-2015), China will focus for the first time on installing distributed photovoltaic power generation systems, aimed at increasing installed capacity to 10 million kilowatts by 2015. Currently, installed capacity is almost zero, and there is ample room for development in this area.

Given the current installation cost of distributed photovoltaic power generation systems at 15,000 yuan (US$2,380) per kilowatts, the total investment in solar-power generation is expected to reach 150 billion yuan (US$23.8 billion) by 2015.

The report said the government would aggressively promote distributed photovoltaic power generation at industrial parks in cities and large enterprises. The price of solar photovoltaic power is close to those of the power used by industries and businesses, and the resulting economic benefits would usher in an era of fair prices for electricity.

Since photovoltaic exports are being obstructed by the US anti-dumping move and countervailing duty, and the EU's anti-dumping duties, the domestic market could increasingly consume overcapacities in photovoltaic power, the report said, citing an analyst.

The analyst predicted that the domestic market would absorb 30%-50% of China's production of photovoltaic batteries in the future.

To cope with overproduction and vicious competition in the photovoltaic industry, the government will raise entry barriers and promote orderly development.

During the five-year plan period, the government aims to create a photovoltaic enterprise with annual sales of more than 100 billion yuan (US$15.87 billion), 3-5 enterprises with annual sales of more than 50 billion yuan (US$7.93 billion) and 3-4 photovoltaic components companies with annual sales of more than 1 billion yuan (US$158.66 million).

Since the beginning of this year, nearly 80% of China's polysilicon enterprises have suspended production, affecting investments worth more than 50 billion yuan (US$7.93 billion) in the industry.