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Party Is Over For Dirt-Cheap Solar Panels, Says China Executive (reuters.com)
The president of a top-10 maker of solar panels said the global solar power industry is about to lose a major competitive windfall as prices of Chinese-made solar panels begin to recover after a collapse last year. "The party is definitely over," said Eric Luo, president of China's GCL System Integration Technology Co. Reuters reports: Solar panel prices tumbled around 30 percent last year after China, the world's largest producer, cut subsidies to shrink its bloated solar industry, pushing smaller manufacturers to the brink of collapse. To raise cash and stay afloat, manufacturers cleared inventory and diverted sales offshore, sending prices into a downward spiral - offering up a windfall for solar power generators and investors in solar farms.
Luo, speaking to Reuters at the World Economic Forum in the Swiss ski resort of Davos this week, said GCL's vertically integrated business model cushioned it from the downturn in prices as its solar farms benefited from cheaper panels. The pain will mostly be felt by smaller Chinese producers, which lack international supply chains, triggering industry consolidation or forcing them to close, he added. Luo said solar panel prices were already stabilizing and he expected them to rebound by 10 to 15 percent as the Chinese industry consolidates over the next year or two. Luo also said that China was getting to the point where the solar industry could operate without any form of subsidy. Northwest China, where the sun is more plentiful and land is less expensive, has already reached that point, he said.
Luo, speaking to Reuters at the World Economic Forum in the Swiss ski resort of Davos this week, said GCL's vertically integrated business model cushioned it from the downturn in prices as its solar farms benefited from cheaper panels. The pain will mostly be felt by smaller Chinese producers, which lack international supply chains, triggering industry consolidation or forcing them to close, he added. Luo said solar panel prices were already stabilizing and he expected them to rebound by 10 to 15 percent as the Chinese industry consolidates over the next year or two. Luo also said that China was getting to the point where the solar industry could operate without any form of subsidy. Northwest China, where the sun is more plentiful and land is less expensive, has already reached that point, he said.
The good news is there are now at least 23 companies making solar panels in the USA, and their prices are becoming more competitive. It'll get even better once the dumb trade war is over.
You are welcome on my lawn.
>That's less than a $0.01 per kWh
Huh? "CN: Usage Price: Electricity for Industry: 35 kV & Above" from https://www.ceicdata.com/en/china/electricity-price
0.870 RMB/kWh = 13 cents USD/kWh
The US price for industrial power is lower across the board:
https://blsstrategies.com/docs/news/News_181.pdf
20 year solar PPAs are being signed for delivery this year at 1.4 cents/kWh. More realistic numbers for China are between 4 and 6 cents. That is precisely why China announced they were no longer offering any support on PV installs. Yet in spite of removing those incentives, current predictions are for ~45 GWp of installs this year in China alone.
It's not hard to see why: PV can be installed incrementally, one panel at a time. Therefore you can easily ramp up and down with supply-n-demand, labor availability, access to cash, etc. Wind and natural gas are next in line in scalability, the former ~1.5MW per install and the later around 200 kW in most cases. But for something like a reactor, it's 1 GW or nothing. This really skews the financing side toward the renewables.