Zhejiang’s once-booming solar industry remains in darkness

November 8, 2013 Leave a comment

Zhejiang’s once-booming solar industry remains in darkness

Staff Reporter

2013-11-07

Beijing has come up with several policies to support the domestic solar industry, however the sector is continuing to face difficulties, the Beijing-based China Enterprise News reports. Kaihua county in Quzhou in eastern China’s Zhejiang province is an important cluster for the domestic solar industry. The local industry grew rapidly between 2006 and 2008, reaching its peak during 2009 and 2010, seeing between 70 to 80 companies, the paper said.Wu Desheng, owner of a local solar power firm said that production has now halted at 41 companies involved in polycrystalline silicon production — a key component of solar panel construction. He said that the prices of polysilicon have fallen significantly in recent years and companies producing the component are suffering from rising deficits.

The price of polysilicon has dropped from 300 yuan to 100 yuan (US$49 to US$16) per tonne in 2009, plunging further to 70 yuan (US$11), and then as low as 20 yuan (US$3.40), the paper said.

Zhan Xueqin, a county official, said that the output value of Kaihua’s solar industry accounted for nearly half of the county’s total industrial output value after more than ten years of development. He said that when demand was high, larger companies could easily see a couple of million yuan a month and at times even see profits of 10 million yuan (US$1.64 million). However, the industry is facing a series of problems and profits have diminished, he said.

Chinese firms began to run into difficulties after the European debt crisis made European countries lower their subsidies for solar electricity, while both the United States and the European Union have launched anti-dumping investigations against solar panel imports from China.

An official surnamed Wang who works at the Zhejiang Kaihua Industrial Park said that there were 48 solar power-related firms operating in the park but there are now only 10. The total output value for the first nine months of this year was only around 36 million yuan (US$5.9 million) per month, he added.

The central and local governments are working to establish plans to help the solar industry tide over the hard times. Sources said that although the government policies may not be able to benefit every company, they are still favorable for the industry as a whole.

Filed under Macro Trends

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