Post-subsidy era of China's photovoltaic industry

After Hertz discovered the photoelectric effect, people realized that solar energy was a huge source of energy that could be converted into electricity. Photovoltaic power generation began to be on the agenda. After decades of development, at present, the photovoltaic industry has become more clear in the global context. China's photovoltaic industry started earlier. In the 1970s, research and production in crystalline silicon materials began. In the mid-1990s, the photovoltaic power generation industry entered a period of steady development. After entering the new century, especially since 2003, China has made leapfrog development in many areas of the photovoltaic industry. The photovoltaic industry has become a pillar industry in some areas of China.

First, the post-subsidy era China's photovoltaic industry has a worrisome outlook 1. China's photovoltaic industry develops a high degree of external dependence. Looking back at the history of the development of China's photovoltaic industry, we have found that for a long time, China's photovoltaic industry has carried out a development model of “two at the outside”. That is, nearly 80% of the raw materials are imported from abroad, while more than 90% of the photovoltaic modules are exported to foreign countries, and China's photovoltaic industry is highly dependent on foreign countries. Figure 1 reflects the trend of annual export value of photovoltaic products in China.

Among China's photovoltaic export destinations, the EU has occupied an important position and has absorbed nearly 75% of China's total share of photovoltaic exports.

2. Photovoltaic subsidy policies in the EU have stimulated the development of China's photovoltaic industry The reason why the EU can absorb so many Chinese PV products is related to the subsidy policies introduced by its member governments.

Germany took the lead. In 1990, the German parliament approved the “Purchase Act”, requiring power companies to allow renewable energy such as solar energy to go online, and purchase all electricity at 65-90% of the retail price of residential electricity. In 2000, the German government promulgated. The “Renewable Energy Law” has improved the existing problems in the “Purchase Electricity Law”, and decided on the basis of different renewable energy types, scales, and locations, and enjoyed fixed on-grid tariffs within a fixed period of time.

Spain is not lagging behind. In 2001, the new “Power Law” was enacted, which stipulated that power companies must purchase solar power at high prices. In 2004, it passed the Decree No. 436/2004, and decided to implement the fixed-grid electricity price policy for renewable energy from 2005. The fixed on-grid price of photovoltaic power generation system is 0.44 euro/kWh, valid for 25 years.

There are also similar photovoltaic support policies in Italy, Greece, and so on.

These photovoltaic support and subsidy policies have effectively inspired the industry's confidence in building photovoltaic power plants. The annual new capacity of photovoltaic installations in Germany has increased from 150 MW in 2003 to 3,200 MW in 2009; the newly added capacity of photovoltaic installations in Spain has increased from 88 MW in 2006 to 2511 MW in 2008. The dramatic increase in installed photovoltaic power capacity The demand for global photovoltaic products. China's PV companies have taken the initiative to invest in and expand production in the manufacturing industry, which has enabled the development of China's photovoltaic industry. China has now become the world's largest PV manufacturing country. Figure 2 reflects the trend of China's solar photovoltaic cell production rising all the way in recent years.

3, EU countries tightening photovoltaic support policies, China's photovoltaic industry is worrisome. Since the global financial crisis, the major EU countries have adjusted and reduced their domestic PV support policies in order to save financial expenses. In early 2009, Spain adjusted its domestic solar industry subsidy policy, and the subsidy scale was reduced to 500 MW. In January 2010, Germany announced the reduction of the on-grid PV tariff. The on-grid price of the rooftop PV system was reduced by 15% from April 2010, and the on-grid price of the on-grid PV system was reduced by 15% from July 2010. At the same time, France also announced that it has tightened its domestic photovoltaic support policy, and the rate of compulsory electricity purchase subsidies for rooftop solar panels has dropped from 0.55 euros per kilowatt-hour in 2006 to 0.42 euros. It can be said that at present, the entire European PV subsidy policy gradually fades out, and the post-subsidy era of the PV industry is coming.

The tightening of policies will inevitably affect the confidence of all parties in the construction of photovoltaic power plants, and will inevitably lead to a significant drop in the new capacity of photovoltaic installations in the EU in the future and in the near future. (Spanish adjusts the domestic PV subsidy policy and newly installed photovoltaic power Capacity decreased from 2511 MW in 2008 to less than 300 MW in 2009). This is a bad news for China's export-oriented photovoltaic companies. On the one hand, this will lead to fierce competition in the domestic industry among the enterprises in the same industry. There will be quite a number of small and medium-sized PV companies that have been eliminated from competition because of their weak competitiveness; on the other hand, Chinese PV companies and foreign companies The competition of enterprises will also intensify and the international trade friction will be inevitable. On the whole, the future of China's PV industry in the post-subsidy era is worrying.

Second, actively responding to prevent adverse situations occurred in the case of the European photovoltaic subsidy policy tightening, at present, China's photovoltaic industry prospects are not optimistic. However, in the face of difficulties, we cannot stand still, and we should actively respond to prevent unfavorable situations.

1. Accelerate technological innovation, reduce costs, and maintain competitiveness After the tightening of the EU's PV support policy, market demand will decrease. With the same shipment volume, supply exceeds demand, market competition will intensify, and the market for photovoltaic cells will increase. The price will be reduced as a result. As a result, the low-cost strategic advantages formed by the low human capital that Chinese companies rely on for a long time will no longer be the case, and the competitiveness of China's photovoltaic companies will decline. Therefore, new competitive forces must be found. In the cost structure, the advanced nature of technology is an important part. Improving technological sophistication and simplifying existing processes are the decisive points for companies to control costs and maintain strong competitiveness. At present, domestic enterprises should speed up the pace of technological innovation, increase the integration of existing processes, improve the efficiency of resource use, and gradually reduce the cost of China's photovoltaic manufacturing industry, and maintain the core competitiveness of China's photovoltaic industry.

2. Encourage the optimization of industrial structure Some time ago, the world's photovoltaic market was huge and corporate profits were obvious, prompting many enterprises in other industries in China to invest in the photovoltaic industry. These enterprises have made certain contributions in the expansion of China's photovoltaic industry scale and the enhancement of its influence, but they have also brought some problems to the development of the industry. Among these enterprises, many formerly engaged in labor-intensive industries relied on buying equipment from abroad and buying technology for production. Their core competitiveness is not strong. In order to ensure the survival of enterprises, they often adopt low-price strategies, but quality is difficult to guarantee. Not conducive to the orderly development of the entire industry. At present, with the increase in the minimum wage level of domestic workers and the decline in the purchase price of foreign PV modules, the continued survival of these companies has become a dilemma. For this reason, it is necessary to optimize and integrate the current structure of China's photovoltaic industry. Some large-scale, technologically advanced, and highly influential companies should be encouraged to take the lead in the acquisition of enterprises with small scale, unobvious competitive advantages, and difficult to survive, realize the reorganization and integration of industrial resources, optimize the domestic industrial structure, and reduce domestic manufacturers. The internal friction between the two countries increases their competitiveness, which makes the domestic industry occupy a favorable position in the competition with foreign industries (SNEN 1.80-1.64%).

3. Changing the export-oriented strategy and focusing on the development of the domestic market For a long time, the domestic photovoltaic industry's pattern of relying on exports to survive has not changed, and domestic industries are vulnerable to changes in the international market. As the EU market is about to tighten, we must find a way out for our existing capacity. We should change the export-oriented development model and focus on the development of the domestic market. At present, under the stimulation of the “Golden Sun Project” and other stimuli, some areas in China have set off a climax of photovoltaic power plant construction. This is a good trend. Domestic photovoltaic companies should seize this opportunity and actively join forces with other entities to build domestically. Large-scale photovoltaic power plants, thereby stimulating domestic demand. Of course, due to the delayed introduction of the PV grid pricing mechanism, the industry’s confidence in the construction of PV power plants is still insufficient. Here, we also call on the relevant government departments to work out a PV grid electricity pricing mechanism as soon as possible to escort the construction of domestic PV power plants. , Pulling China's photovoltaic installation capacity to climb, forming the export of China's photovoltaic industry's existing capacity.

4. Prepare to deal with trade friction After the tightening of EU PV support policy, PV subsidies will be reduced and the market space will also be narrowed. It can be expected that in the near future, the survival competition between Chinese PV manufacturing enterprises and similar enterprises in the European Union will be Intensified. Due to the cheap human capital that most European companies do not have, the difficulty of their survival is higher than that of Chinese PV companies. Under this circumstance, EU companies may set off a new wave of anti-dumping efforts for PV, and the potential for trade friction will increase greatly in the future. Therefore, domestic enterprises must make corresponding preparations to prevent the occurrence of trade frictions. The first is to integrate forces in advance to strengthen domestic cooperation among enterprises in the same industry to avoid vicious competition among domestic enterprises; second, to pay close attention to the dynamics of European companies in the same industry; and third, to regulate the conduct of domestic enterprises in Europe in order to avoid confusing people. The fourth is to set up relevant institutions to study the progress and treatment of domestic and foreign trade friction incidents and do a good job in the judicial and other aspects.