PV power prices avalanche forced critical point approaching

Photovoltaic, a promising emerging industry, has been deeply favored by the capital market and local governments for many years. So far, China has sprung up over 100 industrial bases, and its production capacity accounts for half of the world's total.

However, in 2011, the debt crisis in Europe, the “outside concerns” of the “double counter” investigations, and overcapacity, and the “internal afflictions” of the industry’s turmoil were actually intertwined in the interim. The photovoltaic industry, once in full swing, entered an “extremely cold winter”.

“Spring is ahead! The winter has given birth to three major transformations in the photovoltaic industry, and the critical point of getting away from tariff-based policy subsidies to achieve parity access is accelerating. This will open up the market blowout of photovoltaic power generation.” The head of many leading photovoltaic companies People say so.

Change one: The elimination of brutal inferior eliminates the troubles of growing up. "Since the establishment of the enterprise, there has been no comprehensive production. Not only is there no order, and the order is also a loss, the price is actually too low." Jiangsu Sihong Yongyiyuan Photovoltaic Technology The company is a photovoltaic cell module factory which was put into operation in December 2010. It is standing in a workshop of more than 10,000 square meters and introduced by Chairman Min Yong.

Really relying on real estate began, 2010 Spring Festival learned that photovoltaic components production and sales booming, and lucrative. There are no projects in the world, and a few friends have raised more than 40 million yuan to enter the photovoltaic industry.

In 2010, the photovoltaic industry in the emerging industry halo was one of the few industries that maintained rapid growth under the global financial crisis, and its product profits were also considerable. In the dual role of the investor's mentality of self-interest and the anxiety of local government performance, the photovoltaic industry is booming all over the country. Statistics show that in 2008, there were less than 100 photovoltaic companies in China. After several years of rapid development, there have been more than 500 companies. Photovoltaic module capacity increased by more than 170% in 2010 alone. Compared to the global demand for about 12 GW of photovoltaic modules in China, overcapacity has led to an avalanche decline in product prices. From the beginning of 2011 until now, the price of photovoltaic modules has dropped by about 40%.

Yongyiyuan Photovoltaic Technology Co., Ltd.'s plight of “making money and losing money” is a microcosm of the current Chinese PV industry. According to data from Zhejiang PV SME Alliance, at least 50% of hundreds of small and medium photovoltaic companies in Zhejiang are in semi-discontinued state.

Speaking of the fact that a large number of domestic small and medium-sized photovoltaic companies are currently on the verge of collapse, the photovoltaic giant, which has already entered the industry for more than 10 years, and the president of Suzhou Ats Corporation, Xiaoxuan believes that in recent years, the domestic photovoltaic industry has witnessed blind construction, low level of repetition, and homogenous competition. Worries accumulate in growth. “In the harsh winter period, the intensified competition in the industry, and the elimination of some enterprises are the inevitable rules for the development of the industry. While the survival of the fittest is cruel, the transformation of the healthy growth of the industry is precisely the result of this gestation.”

Change 2: price avalanche forced critical point approached for a long time, the biggest bottleneck restricting the large-scale application of photovoltaic power generation is the on-grid tariff is much higher than conventional power. Photovoltaic modules still rely on policy-based tariff subsidies to have commercial value.

“The sharp decline in the price of photovoltaic products in the winter has brought about a significant drop in the cost of photovoltaic power generation, and the critical point of parity Internet access is accelerating.” Shi Zhengrong, chairman of Wuxi Suntech, said.

It is understood that after this round of price avalanches, the current cost of solar modules has dropped to about US$ 0.8 per peak watt. According to current electricity price levels in the United States and Italy, it is already possible to achieve parity Internet access without government subsidies.

For a long time, photovoltaic power generation has not been recognized and developed in China. This is mainly because its high electricity price is inconsistent with China's national conditions. Wei Qidong, former secretary-general of Jiangsu Photovoltaic Industry Association, introduced that in the Yangtze River Delta region, the peak electricity price for commercial and industrial electricity is about 0.8 yuan to 0.9 yuan, and PV is 1 yuan per kWh. The majority of industry insiders believe that the large-scale application start-up point of domestic photovoltaic power generation.

As early as 2008, in the face of irreparable doubts about the cost disadvantages of photovoltaic power generation, Shi Zhengrong had optimistically predicted that in 2012, domestic photovoltaic power generation will fall to “1 yuan per kWh”. Today, the realization of this prediction has no suspense.

Lou Xiaolu carefully calculated the cost account of a photovoltaic power generation for the reporter. The cost of electricity generated by a megawatt-level terrestrial photovoltaic power plant is mainly composed of photovoltaic components, inverters, transmission and distribution, and power station construction. At present, the PV module costs 8 yuan per watt, the inverter and transmission and distribution are 4 yuan per watt, the power station construction (including civil engineering, support and wiring) is 7 yuan per watt, and the total cost is about 19 yuan per watt. In the western region where the lighting conditions are superior in China, megawatt-level ground-based photovoltaic power plants can already achieve "1 yuan and 1 kWh."

It is understood that the current avalanche of PV products has caused losses in the industry, but some companies that have mastered the cost advantages of core technologies are emerging. At present, the price of photovoltaic raw materials—polysilicon—has plummeted to 30 US dollars per kilogram, and most companies “invert prices” and have stopped production. However, with the core technology of hydrogen chlorination, GCL-Poly has achieved full use of materials and its unit energy consumption has fallen to one-third of the national average. In the second half of 2011, GCL-Poly's production and sales volume of polysilicon did not fall, but it turned against the trend. The world's largest and lowest cost polysilicon feedstock company.

Zhu Gongshan, chairman of GCL-Poly, believes that under the collapse mechanism of price avalanches, the development of photovoltaic companies is relying on scale, relying on production capacity to rely on scientific and technological progress, and on reducing costs, photovoltaic power generation is common, and the family-oriented process is accelerating.

Three changes: "Inside Kaituo" to ease the single market dependency is the European countries' enthusiasm for the development of clean energy, only the government subsidies to nurture the local photovoltaic power generation application market, so that the domestic photovoltaic components found the export market. However, this situation also caused China's photovoltaic industry to rely too much on the European single market. Under the European debt crisis, the domestic photovoltaic industry tasted the bitter fruit of “an egg in a basket”.

Since 2011, European countries have reduced their PV subsidies, and the European market, which originally accounted for more than 70% of the world's PV installations and accounted for 80% of China's PV cell exports, has experienced a sharp decline. In the middle of November, the U.S. Department of Commerce formally launched a “double anti-dumping” (anti-dumping, countervailing) investigation on the photovoltaic industry in China.

In view of this situation, it is impossible to rely on the international market all the time and it has become the consensus of domestic photovoltaic companies and related institutions. Lou Xiaolan said that the expansion of China's photovoltaic industry is not to occupy foreign markets, but mainly to prepare for the Chinese market. Meng Xianqi, deputy director of the China Renewable Energy Society, pointed out that in 2010, the installed capacity of global photovoltaic power generation was 17 GW, and that of China was 800 MW, which was only 2% of the world's total. This time, the United States filed a “double counter” complaint against China, and also reminded China's photovoltaic application market to start up quickly and change the “market out” situation as soon as possible.

In September 2011, the on-grid tariffs introduced by China had promoted the start-up of the domestic photovoltaic market to a certain extent. Some companies have accelerated the construction of power stations in order to catch up with the high on-grid tariffs at the end of the year. Times of sudden increase. According to relevant plans, in 2015, the domestic PV installation capacity will reach 15 GW, and by 2020 it will reach 50 GW.

In addition, facing the shrinking demand in the European market, domestic photovoltaic companies have chosen to develop emerging markets such as North America, Japan, India, Southeast Asia, and South Africa. In December 2011, Hebei Tianwei Group commenced production of a polysilicon project with a capacity of 2,500 tons in the first phase of the largest overseas investment project of the US company. Tianwei Group plans to eventually build Gigawatt-class photovoltaic capacity in the United States. Prior to this, Suzhou Artes had set up factories in Canada, and Wuxi Suntech set up factories in the United States.