Solar PV in China

Although still only in eigth place in the global ranking in installed capacity with 305 MW, but is developing a strong solar PV manufacturing base.

China is emerging as a leader in the global solar PV industry. There is a huge gap between production and consumption and manufactures are predominantly for export at present until the domestic market develops. The solar PV manufacturing industry is growing rapidly and in 2006 and 2007 there has been a spate of IPO’s for Chinese solar companies on the stock exchanges in Shanghai, Hong Kong, New York and London. Chinese module production increased from 134 MW in 2005 to 370 MW in 2006 but in that year installed capacity reached only 70 MW, due to a lack of fiscal incentives to stimulate the domestic market. Four Chinese companies are now in the top ten PV cell manufacturers: Suntech Power, Baoding Yingli JA Solar and Trina Solar
More than half of the current PV installations are located in rural and remote areas, where 60 million people do not have access to a conventional electrical network. These areas are mainly located in the western part of China, which has a lot of solar resources. Urumqi in Xinjiang has become prominent centre for solar PV development.

The industry has government strategic support, including the personal interest of the President and the Prime Minister, both of whom are old alumni of Tsinghua University, the leading technology university in China, with interests in solar PV development.

China has entered the silicon production market and in the next five years will become one of the major producers. In 2006 production capacity was about 500 metric tons and 230 tons were produced. Demand amounted to about 5,100 tons, which was met with imports of 4,630 tons. At present, the majority of China’s module manufacturers rely on imported wafers or cells.
China should be watched as a potential world leader in the solar industry in the next few years. Taiwan, despite its political opposition to the People’s Republic, is a huge investor in China and is fast developing solar PV manufacturing capacity, both for domestic consumption and export.