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China the next solar market for China?

Aug. 13, 2012 at 11:59 AM   |   Comments

BEIJING, Aug. 13 (UPI) -- Despite uncertainty in export markets due to trade disputes, the prospects are still good for China's domestic solar market, experts say.

Last week the Chinese government confirmed that it had raised its target for solar energy capacity by 40 percent, to 21 gigawatts by 2015.

Figures from China's National Energy Administration indicate that in 2011, China's installed solar capacity was about 3 gigawatts, or about 10 percent of the world's total.

Beijing's solar target increase comes about two weeks after a consortium of European solar companies filed a trade complaint with the European Commission, accusing the Chinese of dumping solar products in Europe. And in March, the United States imposed anti-subsidy duties of around four percent on major Chinese companies, followed in May by anti-dumping duties of 31 percent.

Chinese solar companies have exported almost $2 billion worth of solar panels each year to the United States and the European market accounted for nearly 60 percent -- about $35.8 billion -- of China's solar exports in 2011.

"It would be catastrophic for China's solar industry once the higher import tariff is in place," Meng Xiangan, deputy director of the China Renewable Energy Society was quoted as saying by China Daily newspaper.

"But it will not be the end of the story. Companies that focus on innovation and reducing cost will come out on top after the solar PV industry emerges from the turmoil."

Michael Carboy, head of China research with Deutsche Bank Climate Change Advisors, still believes China's domestic solar sector has potential.

"Greenhouse gas emissions, air pollution concerns, the need for more power to electrify both a growing economy and an expanding and wealthier middle class are all strong motivations for China to continue nurturing the domestic solar sector," Carboy said.

At the local level, many provincial governments are promoting solar installation projects. Northwest China's Gansu province has set the most ambitious target, for 5,000 megawatts of solar capacity to be installed by 2015.

Yingli Green Energy, a leading Chinese solar company, hopes to sell 2,500 to 2,600 megawatts worth of solar panels this year, with 900 megawatts of that in China, and the company expects domestic sales to contribute 35 percent to revenues in 2013, up from 6 percent in 2010.

"We all know there is a rosy future," for China's solar sector, says Yingli spokesman Liang Tian. "But no one can be sure how long we will have to wait before we get there."

Meanwhile, Yingli is apparently outwardly optimistic: banners with motivational slogans such as "climbing up the solar PV snow mountains" decorate the company's plant in the northern province of Hebei.

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