China outdid the rest of the world by far last year when it set aside a whopping $200.8 billion in stimulus funding for cleantech. The commitment soared 79% above the $112.2 billion in stimulus funds that the United States allocated to the industry, according to the Stern report, making China the largest potential investors in the sector in one fell swoop. Contributor Jennifer Kho reports.
(October 7, 2010) — China outdid the rest of the world by far last year when it set aside a whopping $200.8 billion in stimulus funding for cleantech. The commitment soared 79% above the $112.2 billion in stimulus funds that the United States allocated to the industry, according to the Stern report, making China the largest potential investors in the sector in one fell swoop.
Still, the solar activity that has been disclosed is significant enough that no list of top solar champions would be complete without at least a mention of the Chinese government. In November, China Investment Corp., the government’s sovereign wealth fund, invested HK$5,563 million (US$715 million), in polysilicon and wafer supplier GLC-Poly Energy Holdings. The deal gives CIC an approximately 20% stake in the company, according to the press release, and the two companies planned to set up a joint venture to develop US$500 million of solar projects. Read ” Report: China’s scrap-Si ban helps domestic PV firms” for more on the government’s role in the solar industry. Also see ” Tier 2 rising: New Chinese c-Si firms challenging thin-film producers”
Overall, the government has played a major role in lowering the price of solar worldwide, and that will likely help grow the solar market — even if it’s also squeezing margins for many players outside of China today. The country is supporting its solar industry with low- or no-interest loans with extremely favorable terms, free land, low-cost labor and many other breaks, says Paula Mints, a principal analyst at Navigant Consultant, who projects more than 15GW of shipments from the country this year alone, with plenty of leftover inventory in China’s distribution houses.
The easy financing has enabled many Chinese manufacturers to expand into many parts of the solar supply chain, and — combined with the low value of the yuan and some trade barriers — this has helped Chinese companies dramatically lower the prices of solar cells and panels, she says. Most of those panels are getting exported because the Chinese market for solar remains small, and the low prices have left manufacturers in other parts of the world struggling to compete, she adds. In most cases, “it is still cheaper to buy a module or cell from China than it is to manufacture in house,” she says, adding that most of her list of top 10 manufacturers next year will come from China and Taiwan.
Charlie Gay of Applied Materials, president of Applied Solar, commented on China as a producer of PV wafers, cells and modules: “It’s a trend we are watching unfold this year, with over 80% of new orders originating in Asia, dominated by China. They are also becoming a leading consumer of solar PV energy as the Chinese government has been active in putting a policy framework in place to emerge as a #1 consumption market,” he said. “Strong government support for renewables in Germany and China has turned these countries into global leaders in this market.” Read an in-depth interview with Gay in “Champions of photovoltaics technology“
Jennifer Kho is a freelance reporter and editor with more than a decade of journalism experience spanning newspapers, magazines, and the Web.