China Leads the World in Sales of Solar Modules

From South China Morning Post

China became the world’s largest solar power panel market in last year’s fourth quarter, and might retain the top spot throughout this year, according to industry consultancy NPD Solarbuzz.

China accounted for 33 per cent of the 8.3 gigawatts of solar modules shipped globally in the quarter, up from under 10 per cent two years ago, the United States-based firm said.

Modules are assembled into panels, which can be ground-mounted in solar farms, mounted on building rooftops or embedded in curtain walls.

“China will likely become both a centre for upstream solar modules and parts manufacturing, and downstream applications,” Michael Barker, a senior analyst at NPD Solarbuzz, said.

For the whole of last year, China accounted for around 15.5 per cent, or 4.5 GW, of the global market of 29 GW, the consultancy’s mainland-based analyst Ray Lian Rui said. This represented growth of around 70 per cent from 2011. China ranked second after Germany.

After surging 40 per cent in 2011, the global solar panel market grew just 6 per cent last year, NPD Solarbuzz data shows.

The slowdown was prompted by cuts in incentives in several key European markets like Germany and Italy, with Italy – the world’s biggest market in 2011 – witnessing the biggest decline of about half, according to research house IHS Solar.

Lian said that thanks to strong government incentives initiated last year, China should hang on to its No1 position this year, taking a 22 per cent share of the estimated global market of 32 GW.

He forecast China, which used to export over 90 per cent of its modules, will export two-thirds of its output and sell one-third domestically this year. Trade restrictions in the US and Europe have helped spur mainland producers to sell more in the domestic market.

Beijing ramped up subsidies for solar farms almost seven-fold last year in terms of output capacity from 2011.

It is also mulling subsidising a 15 GW of off-power grid solar panel installation in the next few years and a separate subsidy programme for rural communities.

Despite concerns grid connection bottlenecks will appear just as they did with wind farms, Lian said this was not a major concern so far because the solar sector was smaller in scale and more of its installations were off-grid compared with the wind-farm industry.

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