Solar industry enters winter quickly

Affected by the European debt crisis, the external demand for PV modules plummeted, and internal expansion could not be digested, eventually leading to rapid winterization of the PV industry.

Photovoltaics used to be a spectacularly rich industry. Since 2003, this industry has created a number of super-rich in China – Shi Zhengrong, Peng Xiaofeng, Miao Liansheng and other photovoltaic giants have become media stars. By the end of last year, 60% of the world's PV modules were produced in China, and this proportion is still rising. Among the top 10 companies in the global shipments of PV modules, China accounted for 5 seats.

However, after experiencing a wave of fiery markets in 2010, the star industry turned to a sudden turnaround in 2011. Since the beginning of the year, the prices of silicon, silicon wafers, batteries, and components have been declining all the way to the junction box, ultra-white glass, and components. The price of peripheral materials such as borders has also fallen fiercely. All companies in this industry chain have been forced to cut prices and sales, and the rate of fierceness has caused many companies to lose weight. In the second quarter of 2011, the overall net loss of Chinese solar energy companies listed in the United States was US$120 million. The gross profit of the entire industry dropped sharply, and a large number of companies fell into losses. At the same time, several well-known overseas PV companies declared bankruptcy due to insolvency, and there were Some overseas PV giants have also reduced their production cuts in order to protect themselves. Although there are no large-scale Chinese PV companies that have declared bankruptcy, some companies have stopped production of some of their production lines and the capital chain is very tight. In a moment, the industry atmosphere is like winter.

Affected by the European debt crisis, the European market, which accounts for more than 70% of the world's PV installed capacity, suddenly stagnated, directly impacting the global PV market. Since 2011, European countries have reduced their PV subsidies. In 2010, Germany and Italy, which ranked the top two in terms of PV installed capacity, saw a sharp drop in their installed capacity in the first half of 2011 due to changes in the subsidy policy. In May 2011, Italy approved a new solar PV subsidy bill: It is prepared to limit the annual subsidies for solar power generation to 6 billion to 7 billion euros, and the subsidies will be linked to the scale of installed capacity.

In February 2011, Germany adopted a plan to reduce the price of on-grid PV, and the on-grid tariff reduction was determined based on the installed capacity. Only when the installed capacity is less than 3.5 GW in the same year, it will not reduce the PV on-grid tariff. If the installed capacity is increased by 1 GW, the reduction in PV subsidies will increase by 3%.

From January to May 2011, European PV installations were almost in a state of stagnation. After the dust settled in June, there was a slight rebound in the installed capacity in the European market, but recently there was bad news. It is rumored that the German government may be the fastest in 2012. In January of this year, the proportion of solar energy subsidy policies was cut by as much as 15%, which is 6% more than the previous plan.

From the domestic market, since 2007, the major battery and component plants have expanded their production capacity, and the targets have been extremely encouraging. At the same time, countless capital has poured into the solar energy industry. Many companies that were previously irrelevant to solar energy have also in Change line. For a time, various people and horses pursued their interests under the name of green in the sun. Photovoltaic industrial parks were everywhere throughout the country. They were spectacular. Although they cannot be said to have died, they are indeed regarded as flourishing. .

At the time when all parties were full of ambition, the European debt crisis, which had been temporarily stable, entered the second phase. On January 14, 2011, Fitch downgraded Greece’s sovereign credit rating and the outlook was negative. Since then, the crisis has rapidly deteriorated and spread. In order to more effectively control the debt problem, European countries implemented a strict fiscal austerity plan in an attempt to reduce the fiscal deficit as much as possible. Under this background, photovoltaic power generation that depends on government subsidies has become a target for deficit reduction. At the same time, European banks have tightened It also made it more difficult for the newly-added PV power plants, and new projects were stalled, leading to further deterioration of demand.

In mid-2011, the global PV module inventory was as high as 10GW or more, far exceeding the worldwide installed capacity in 2009, which is the highest record so far. If the current price is 1.5 US dollars per watt, the 10GW inventory is equivalent to 15 billion US dollars. It has directly led to the collapse of many companies in the short-term months due to the disruption of the capital chain or the collapse of the company.

Since China introduced a PV on-grid tariff policy, many people expect that the Chinese market will soon break out, and the new energy policy introduced by Obama may also bring about huge demand. However, even if these two markets are amazingly expanding, their capacity is limited and they can only be given to companies. A bit of a wheeze will not save them fundamentally.

Chinese companies should prepare cotton coats for the winter. A Chinese saying goes well: 1929 does not sell goods; 3949 does not freeze dogs; 5969 looks along the river to Liu; for Chinese PV companies, 1929 has passed and is now 3 Nine, several companies have been frozen. After 39, there are 4 or 9.