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The Future Outlook of PV Application in China | DeBlock Consulting Ltd.

The Future Outlook of PV Application in China

Source: CNPC News ( view article )

In the solar industry, application is the only true road to development

China’s Development and Reform Commission recently announced their solar PV power grid feed in policy, bringing new vitality to the domestic solar industry that has been in such a “drought”. Some believe that the policies will increase domestic demand for solar PV products, add to this the polycrystalline and monocrystaline silicon prices dropping so quickly, the domestic solar industry will experience fierce growth. The solar PV market will shift from begin “the Europe era” and transition into “the China era”.

All optimistic hopes, however, are accompanied by pessimistic concerns. Compared with the 0.25RMB/KWh of hydro power, the 0.38RMB/KWh of thermal power, and the 0.43RMB/KWh of nuclear power, solar power, with a price of up to 1.15RMB/KWh is obviously very high, and if there isn’t enough room for profit, then it won’t only mean a poor outlook for the industry’s development, but will also lead to some short term speculative investments, eventually destroying much of the development potential in the solar PV industry.

Some people believe government policy came about too quickly, and they worry that some of it will be difficult to follow through on. Also, some of the companies who previously won project bids are feeling hard done by, they put their profits under pressure to lower cost and support the government in the special permission bidding, thus driving the establishment of solar PV power grid prices, but they don’t get to enjoy the 1.15RMB grid price. This seems unfair.

Regardless whether optimistic or pessimistic, when looking at the need for clean energy development, real application of solar PV power is what people watch most closely. At present, China’s application of solar power is only 2%-4% of it’s manufacturing capacity. The “Golden Sunshine” project was started over 2 years ago and it is still in the pilot project stage.

China’s solar power industry has developed at fundamentally the same pace as other nations, but it is countries like America, Germany, and Japan that are actually using the solar panels, their home solar power systems have already developed to the point where they are not just supplying themselves, they are also selling power into the grid. In Japan 1/6 of homes have already become “household green power plants”. These are the big countries for application, they also hold the core solar PV technologies.

Lack of application is a major factor that has led to the failing domestic market. Lack of application means lack of benefit and lack of practice, allowing solar power application technology to become “water without a source”. Practice proves that only with broad application can the solar industry truly develop.

Therefore, in order to promote the development of the solar industry, in addition to the problems of coming out with feed in policies, more important are the problems associated with solving solar power grid connection and household application efforts. The solar power generation industry is this way, and so are the wind an bio energy power generation industries.

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