Sun Rises Slowly on China’s Solar Energy Sector

Solar power equipment makers will have to wait another half-decade or so before China, one of the world’s fastest-growing but most polluted economies, becomes a major market for them alongside Europe.

But many are already preparing.
A bevy of US-listed Chinese firms such as SunTech Power and foreign players such as Applied Materials Inc are starting to expand capacity in China, ploughing billions of dollars into factories across the country to capitalise on Beijing’s intention to generate a tenth of its power from renewables by 2010.

Executives and analysts warn Beijing first needs to get its act together and come up with an over-arching blueprint for subsidies, tax incentives and other schemes — as European governments have done — to drive the sector.

Expansion itself is fraught with risk: this early in its development, some analysts say the sector is getting overcrowded and predict a shake-out benefiting big companies with access to the expensive raw material, polysilicon, and weeding out minor players.

Planet Ark