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Page added on February 20, 2014
China Confirms 14 Gigawatts of Solar Energy Incentives for 2014
china solar, solar industry growth
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China will be the number one solar market again in 2014 if it meets its recently announced goals.
China’s National Energy Administration has set a 2014 goal of incentivizing 14 gigawatts of domestic solar capacity, 6 gigawatts aimed at utility scale and 8 gigawatts aimed at distributed generation.
Adam James of Greentech Media notes, “The 14 gigawatt target is consistent with our expectations for how the Chinese government will approach PV development in 2014. We do note, however, that reaching this target may present some difficulties: particularly if the allocation between utility-scale generation and distributed generation is enforced as a strict funding cap. On the one hand, the distributed market in China is still very new and has some growing pains, so reaching 8 gigawatts is highly ambitious. On the other hand, constraining utility scale generation to 6 gigawatts may present challenges for companies who already have sizeable expected pipelines in 2014. Despite these headwinds, we do expect China to be the largest market for installed capacity in 2014.”
China was the market in leader in 2013 with about 12 gigawatts — after growing from approximately 3 gigawatts in 2012.
Deutsche Bank Equity Research notes that China has set quotas for individual provinces with the Eastern provinces of Shandong, Jiangsu and Zhejiang at a quota of 1.2 gigawatts each. Vishal Shah of Deutsche Bank writes, “If grids are unable to absorb the power and solar panels stay idle, the agency may reduce the quotas.”
Shah adds, “While there are specific targets laid out for each province, it is still unclear how well the government is able to track installations given the localized permitting structure. We believe the tier 1 module suppliers are well positioned to capitalize on the domestic market and expand their installation business in the process. Given attractive IRR’s on most projects in the region, we believe the country can likely reach this target, which will put further upward pressure on pricing in the industry. Given several planned poly expansions coming online over the next 1-2 years and rising prices, we believe further long term agreements between poly and module suppliers are likely.
Deutsche Bank sees this announcement as positive for Trina Solar and Yingli.
8 Comments on "China Confirms 14 Gigawatts of Solar Energy Incentives for 2014"
Makati1 on Thu, 20th Feb 2014 3:11 am
Gotta spend those shrinking dollars somewhere and where better then progressive infrastructure. Maybe empty cities are better than empty dollars? ^_^
DC on Thu, 20th Feb 2014 3:21 am
I have no problem with clean energy, but again, I have to ask, has any of Chinas allegedly massive push for green-whatever had any material effect on pollution, any whatsoever?
From what I can see, it hasnt-not in the slightest. Or maybe, the real purpose of those incentives is simply to help expand the total energy supply so China can continue to expand its resource consumption, which of course, = more pollution. You know, just like we do. The morons at Green tech media never ever mention if all those panels are making lives better for the avg. Chinese citizen. And they never will because they already know the answer.
Its not how much energy you have, or even to lessor degree how you make it, but what you are using it *for*. My people, and the Chinese want more energy so we can consume more. We dont really care how it gets to us. Well, the oil and coal companies care-but end users and society at large dont. They just want energy-and if its cheap enough to waste frivolously-then PARTY ON! The green washing is just a bonus(if its clean that is).
Davy, Hermann, MO on Thu, 20th Feb 2014 3:34 am
I bet the efficiency in China is low with all the smog and dust. YEA, all the cities out in the middle of nowhere that people don’t live in. How about that embedded energy waste. How about the highways to nowhere and that embedded waste. How about all the ship building overcapacity or for that matter most industries in China are in a state of massive overcapacity. How about that embedded energy waste. Then I hear about all this solar power and I am supposed to think Man Makati is right China is the greatest country that ever inhabited planet earth. I say to myself yea China a model green country full of solar panels.
GregT on Thu, 20th Feb 2014 6:15 am
davy,
China is only attempting to emulate the west. You can’t blame them for wanting everything that they have seen in the TV ads, and on all of the posters and billboards for the last 25 years. We in the west have set a bad example, and now all of us are going to pay the consequences.
Makati1 on Thu, 20th Feb 2014 7:47 am
DC, have you considered that most of their resource consumption is being exported? If we still made all of our junk in the US, we would be like China. In fact, we were, just before we started shipping our factories/jobs and pollution there.
DC on Thu, 20th Feb 2014 8:35 am
Ummm yea, I have, remember? Im with you on all that. But just because they make all our salad shooters, cookbooks and i-craps doesn’t mean they cant, wont and arent growing there own in-house consumption…
Davy, Hermann, MO on Thu, 20th Feb 2014 10:48 am
@Makati/@DC – Yea, of course trading, like love making, is a two way street. I am not denying sins of the largest historical polluter nor do I deny the reverse export of pollution through trade. To say you can’t blame the Chinese because the envy the US through TV is being overly paternalistic and simplistic. The highest levels of economic and political Chinese class have chosen this route. These folks through greed and enlighten self-interest entered into a mutually beneficial arrangements with the likes of Walmart et all. This push to grow came at a time when the minds of the world believed in globalism and growth to solve the world’s problems. And I agree one way to lower population, reduce pollution, and develop a stable society is strategies like educate young women, build healthy infrastructure, manage waste, and etc – et all. The problem is the minds in the world rejected the “Limits of Growth” Premise. They felt growth would stabilize in a richer global world. Knowledge and technology would solve the various problems facing society with economic growth. There is the very real aspect of greed in China and China’s trading partners. There is the grass roots desire to live better lives. Maybe all this is not in our direct control but part of a self-organizing system of economics, politics, and social fabric. So, no, always pointing to the US as the culprit is simplistic and distorting. You both are smart people or you would not be here but your desire to villainize the US distorts the truth IMHO.
Kenz300 on Thu, 20th Feb 2014 4:24 pm
The transition to safer, cleaner and cheaper alternative energy sources continues around the world.
China’s growing use of solar will help to drive down prices even further. Increases in economies of scale and technological advances means alternative energy sources will continue their growth around the world in spite of what the fossil fuel industry says.