The world’s largest PV installation market, Germany, will explicitly lower its PV subsidies, which will impact China, the world’s largest PV module manufacturing country.
Bloomberg yesterday quoted Georg Nuesslein, a spokesperson for the Christian Social Union (CSU), one of the German ruling parties, saying that the reduction bill was scheduled to be announced on June 27, German time, and that the reduction will be traced back to April 1. The reduction is expected to be between 20% and 30%.
According to past data, European markets represented by Germany and Italy generally account for about 70% of China's PV module export ratio. Last year, Germany had an installed capacity of 7.5 GW (1 GW = 1000 MW, 1 MW = 1000 kW). Against the backdrop of the shadow of the debt crisis in Europe, the Merkel government hopes to reduce the subsidy spending on photovoltaics, and will reduce the installation volume this year by about 50%.
After the latest subsidy reduction, the German photovoltaic application market will enter a period of low profit or even no profit, which will undoubtedly make China's PV module companies worse. In a quarterly report released on June 26th, Jiangxi LDK Solar Energy Technology Co., Ltd. (NYSE:LDK) realized net sales of US$201 million in the first quarter, a decrease of 73.8% compared to the same period of last year; the net attributable to shareholders of listed companies The loss amounted to 185.2 million U.S. dollars.
Some analysts said that the global PV market will shift its focus to emerging markets, and China's PV manufacturing companies will also change the direction of export trade, and instead seize the emerging markets in South America to hedge against the impact of the decline in installed capacity in the European market. The German market entered the era of meagre profits. According to available data, before the above-mentioned reduction bill was announced, the German PV subsidy policy was: the installed capacity was between 0-30 kilowatts, and the on-grid price (FIT) was 24.43 cents per kilowatt hour; Between 30 kW and 100 kW, the on-grid price is 23.23 cents per kilowatt hour; the installed capacity is between 100 kW and 1 MW, the on-grid price is 21.98 cents per kilowatt-hour; the installed capacity exceeds 1 MW, and the on-grid tariff It's 18.33 cents per kilowatt-hour.
"If this adjustment has reached between 20% and 30%, then Germany's photovoltaic installation market will enter the era of meager profits." A photovoltaic operator related to the reporter told reporters.
Bloomberg New Energy analyst Travis Woodward said in a report that after the reduction, the internal rate of return for the German utility-level power station project may be around 6%.
Previously, due to concerns about the passage of the above-mentioned bills, photovoltaic operators operating in Germany have accelerated the rush to install, so in the first quarter of this year there was a wave of rushing equipment.
This year's large-scale German rushing tide should no longer appear. "The responsible person said.
A report released by GTM Research, a renewable energy consultancy, said that PV module manufacturers will also face a difficult period of more than three years until the market closes excess capacity.
According to data provided by GTM analyst ShyaMehehta, this year's PV modules have a capacity of 59 GW. It is estimated that the global module sales volume will be about 30 GW, and the production capacity will be about twice the sales volume. GTM claims that as the price of modules continues to fall sharply as a result of overcapacity, currently about 21 GW of production will be “retired†in 2015.
Goldman Sachs predicts that PV module prices will continue to decline to 67 cents per watt by 2013. In the rest of this year, photovoltaic companies will still struggle.
Before the new subsidy policy of Japan, the rapid growth of the global photovoltaic application market was due in large part to the strong subsidies and support from European countries represented by Germany and Italy.
Suntech, LDK, and First Solar, etc. were encouraged by this, and they once substantially expanded their production capacity.
Today, the aforementioned European countries have cut their subsidies, undoubtedly causing the European PV market to contract.
According to investment bank Jefferies analyst Jesse Pichel, the global demand for solar energy has grown at a moderate pace this year at least. In the second half of the year, European demand has fallen further than in the first half of the year, and will drop even more in 2013. Jesse Pichel believes that there will be signs of improvement in the industry in the second half of 2013 and even 2014.
“In the future, photovoltaic exports will certainly be more dispersed and the proportion of emerging markets will be even greater.†A person in charge of a photovoltaic module company in China told the Morning Post reporter.
According to research firm NPD Solarbuzz, although the preferential policies for photovoltaics in several major European markets have been adjusted, the total global PV demand in 2012 is expected to increase by about 10% from the previous year. This is due to China, Japan, India and other emerging countries. Together, the market will usher in a period of rapid growth.
"It is expected that China's domestic PV demand will reach 5-6 GW level." Solarbuzz said in a research report that China's PV project reserves have reached 35 GW, of which 61% are located in the Northwest Territories. Regional installation projects in the northwestern provinces of Gansu, Qinghai, Xinjiang, and rooftop installation projects in eastern provinces such as Jiangsu and Zhejiang are expected to have an important share of the Chinese domestic market this year.
Solarbuzz expects that China's PV installations this year will be "sit one for two." Taking into account the German reduction bill and the country hopes to reduce its installation this year to 50% of the 7.5 GW of last year, China will be expected to become the world's largest photovoltaic market. It is worth noting that this year, the Japanese market suffering from the nuclear disaster will also become the focus of China's PV companies. Japanese Minister of Economy, Industry and Commerce Yukio Noriyuki has announced that Japan has officially adopted a renewable energy incentive policy and has approved a solar subsidy policy that will encourage the country to add at least 3.2 GW of PV installation capacity. The Japanese government will provide photovoltaic power generation with a subsidy of 42 yen per kilowatt-hour, which is twice the German subsidy and three times the amount of China's subsidy. However, Japan also has concerns about such a large amount of support for renewable energy, fearing that this will increase the overall price of electricity in Japan.
At present, domestic PV companies such as Suntech and Artes are all located in Japan.
Subsidy cuts will be the norm. The aforementioned person in charge of photovoltaic operators stated that as the cost of photovoltaic power generation continues to fall, the reduction in photovoltaic subsidies is an inevitable trend. How to achieve parity online as soon as possible and find new market hotspots and business models will be an important future direction. The German reduction bill also mentions when it will no longer continue to provide PV subsidies for PV. According to the bill, when the cumulative installed PV capacity in Germany reaches 52 GW, the newly added photovoltaic power generation will be connected to the grid at the market price without any subsidies.
"The once huge German market will become mediocre and forgetting subsidies will become a trend," said a photovoltaic analyst.
Chairman of the Tianhua Sunshine Holdings Co., Ltd. Su Weili said in an interview with the Post reporter that photovoltaic companies should pay more attention to emerging markets, especially the South American market, in the second half of the year compared to the Western European market dominated by Germany. “Excellent light conditions are not lower. The electricity price, we can achieve parity in Chile and Brazil in 2012, without government subsidies."
On June 26th, Tianhua Sunshine and the China Development Bank announced that they would cooperate with the Chilean industrial group SigdoKoppers to conduct the largest investment by Chinese companies in the Andean National Community: a $900 million solar park project.
The cooperation agreement shows that the three parties mentioned above will jointly develop a 300 megawatt solar project within the next three years. On the 26th, Premier Wen Jiabao of the State Council of China was visiting Chile.
Bloomberg yesterday quoted Georg Nuesslein, a spokesperson for the Christian Social Union (CSU), one of the German ruling parties, saying that the reduction bill was scheduled to be announced on June 27, German time, and that the reduction will be traced back to April 1. The reduction is expected to be between 20% and 30%.
According to past data, European markets represented by Germany and Italy generally account for about 70% of China's PV module export ratio. Last year, Germany had an installed capacity of 7.5 GW (1 GW = 1000 MW, 1 MW = 1000 kW). Against the backdrop of the shadow of the debt crisis in Europe, the Merkel government hopes to reduce the subsidy spending on photovoltaics, and will reduce the installation volume this year by about 50%.
After the latest subsidy reduction, the German photovoltaic application market will enter a period of low profit or even no profit, which will undoubtedly make China's PV module companies worse. In a quarterly report released on June 26th, Jiangxi LDK Solar Energy Technology Co., Ltd. (NYSE:LDK) realized net sales of US$201 million in the first quarter, a decrease of 73.8% compared to the same period of last year; the net attributable to shareholders of listed companies The loss amounted to 185.2 million U.S. dollars.
Some analysts said that the global PV market will shift its focus to emerging markets, and China's PV manufacturing companies will also change the direction of export trade, and instead seize the emerging markets in South America to hedge against the impact of the decline in installed capacity in the European market. The German market entered the era of meagre profits. According to available data, before the above-mentioned reduction bill was announced, the German PV subsidy policy was: the installed capacity was between 0-30 kilowatts, and the on-grid price (FIT) was 24.43 cents per kilowatt hour; Between 30 kW and 100 kW, the on-grid price is 23.23 cents per kilowatt hour; the installed capacity is between 100 kW and 1 MW, the on-grid price is 21.98 cents per kilowatt-hour; the installed capacity exceeds 1 MW, and the on-grid tariff It's 18.33 cents per kilowatt-hour.
"If this adjustment has reached between 20% and 30%, then Germany's photovoltaic installation market will enter the era of meager profits." A photovoltaic operator related to the reporter told reporters.
Bloomberg New Energy analyst Travis Woodward said in a report that after the reduction, the internal rate of return for the German utility-level power station project may be around 6%.
Previously, due to concerns about the passage of the above-mentioned bills, photovoltaic operators operating in Germany have accelerated the rush to install, so in the first quarter of this year there was a wave of rushing equipment.
This year's large-scale German rushing tide should no longer appear. "The responsible person said.
A report released by GTM Research, a renewable energy consultancy, said that PV module manufacturers will also face a difficult period of more than three years until the market closes excess capacity.
According to data provided by GTM analyst ShyaMehehta, this year's PV modules have a capacity of 59 GW. It is estimated that the global module sales volume will be about 30 GW, and the production capacity will be about twice the sales volume. GTM claims that as the price of modules continues to fall sharply as a result of overcapacity, currently about 21 GW of production will be “retired†in 2015.
Goldman Sachs predicts that PV module prices will continue to decline to 67 cents per watt by 2013. In the rest of this year, photovoltaic companies will still struggle.
Before the new subsidy policy of Japan, the rapid growth of the global photovoltaic application market was due in large part to the strong subsidies and support from European countries represented by Germany and Italy.
Suntech, LDK, and First Solar, etc. were encouraged by this, and they once substantially expanded their production capacity.
Today, the aforementioned European countries have cut their subsidies, undoubtedly causing the European PV market to contract.
According to investment bank Jefferies analyst Jesse Pichel, the global demand for solar energy has grown at a moderate pace this year at least. In the second half of the year, European demand has fallen further than in the first half of the year, and will drop even more in 2013. Jesse Pichel believes that there will be signs of improvement in the industry in the second half of 2013 and even 2014.
“In the future, photovoltaic exports will certainly be more dispersed and the proportion of emerging markets will be even greater.†A person in charge of a photovoltaic module company in China told the Morning Post reporter.
According to research firm NPD Solarbuzz, although the preferential policies for photovoltaics in several major European markets have been adjusted, the total global PV demand in 2012 is expected to increase by about 10% from the previous year. This is due to China, Japan, India and other emerging countries. Together, the market will usher in a period of rapid growth.
"It is expected that China's domestic PV demand will reach 5-6 GW level." Solarbuzz said in a research report that China's PV project reserves have reached 35 GW, of which 61% are located in the Northwest Territories. Regional installation projects in the northwestern provinces of Gansu, Qinghai, Xinjiang, and rooftop installation projects in eastern provinces such as Jiangsu and Zhejiang are expected to have an important share of the Chinese domestic market this year.
Solarbuzz expects that China's PV installations this year will be "sit one for two." Taking into account the German reduction bill and the country hopes to reduce its installation this year to 50% of the 7.5 GW of last year, China will be expected to become the world's largest photovoltaic market. It is worth noting that this year, the Japanese market suffering from the nuclear disaster will also become the focus of China's PV companies. Japanese Minister of Economy, Industry and Commerce Yukio Noriyuki has announced that Japan has officially adopted a renewable energy incentive policy and has approved a solar subsidy policy that will encourage the country to add at least 3.2 GW of PV installation capacity. The Japanese government will provide photovoltaic power generation with a subsidy of 42 yen per kilowatt-hour, which is twice the German subsidy and three times the amount of China's subsidy. However, Japan also has concerns about such a large amount of support for renewable energy, fearing that this will increase the overall price of electricity in Japan.
At present, domestic PV companies such as Suntech and Artes are all located in Japan.
Subsidy cuts will be the norm. The aforementioned person in charge of photovoltaic operators stated that as the cost of photovoltaic power generation continues to fall, the reduction in photovoltaic subsidies is an inevitable trend. How to achieve parity online as soon as possible and find new market hotspots and business models will be an important future direction. The German reduction bill also mentions when it will no longer continue to provide PV subsidies for PV. According to the bill, when the cumulative installed PV capacity in Germany reaches 52 GW, the newly added photovoltaic power generation will be connected to the grid at the market price without any subsidies.
"The once huge German market will become mediocre and forgetting subsidies will become a trend," said a photovoltaic analyst.
Chairman of the Tianhua Sunshine Holdings Co., Ltd. Su Weili said in an interview with the Post reporter that photovoltaic companies should pay more attention to emerging markets, especially the South American market, in the second half of the year compared to the Western European market dominated by Germany. “Excellent light conditions are not lower. The electricity price, we can achieve parity in Chile and Brazil in 2012, without government subsidies."
On June 26th, Tianhua Sunshine and the China Development Bank announced that they would cooperate with the Chilean industrial group SigdoKoppers to conduct the largest investment by Chinese companies in the Andean National Community: a $900 million solar park project.
The cooperation agreement shows that the three parties mentioned above will jointly develop a 300 megawatt solar project within the next three years. On the 26th, Premier Wen Jiabao of the State Council of China was visiting Chile.
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