China risks being displaced as the world’s largest solar market as measured by annual installations after some project approvals were postponed.
“There isn’t enough time to achieve the target,” Li Junfeng, director general of the National Center for Climate Change Strategy and International Cooperation, said in an interview in Beijing.
The delays mean China could fall short of its goal to install 14 gigawatts of solar capacity, Li said. Japan is expected to add 10.3 gigawatts to 11.9 gigawatts of solar power in 2014, Bloomberg New Energy Finance forecasts.
The shortfall poses the biggest risk to small panel producers that rely most heavily on the domestic market, said Wang Xiaoting, a Hong Kong-based analyst for BNEF. Bigger producers such as Yingli Green Energy Holding Co. and Trina Solar Ltd. will be more resilient because they’ve diversified and moved to markets with higher prices, she said.
Policy makers have purposely delayed approvals on large utility-scale projects to make way for more installations on rooftops following a push to boost the use of distributed solar power. China plans to add as much as 8 gigawatts of solar on rooftops, factories and other buildings in 2014, a more than 10- fold increase compared with the previous year.
China is expected to install less than 12 gigawatts of both distributed and large-sized solar capacity this year, Li said. When grid connection issues are considered, capacity additions may fall below 10 gigawatts, he said.
China saw a record addition of 8.9 gigawatts of solar in the last quarter of 2013 as developers rushed installations ahead of a tariff cut, according to data from Bloomberg. The last three months of last year accounted for almost 70 percent of annual installations for the whole of 2013, according to data compiled by Bloomberg.
The nation added 3.79 gigawatts of new grid-connected solar capacity from the beginning of the year to the end of September, according to the National Energy Administration. China hasn’t announced any reduction plan in preferential power prices this year.
The country had almost 20 gigawatts of solar capacity at the end of 2013 and is targeting a total of 35 gigawatts of installations by 2015.
Solar accounts for about 2 percent of China’s electricity generation capacity, up from 0.08 percent four years ago and double what nuclear power contributed last year, according to BNEF.
Copyright 2014 Bloomberg
Lead image: Solar panels via Shutterstock