By Wang Yichen
With the rise of China's PV (photovoltaic) industry, the disturbance encountered by Chinese PV companies in Europe and the United States market has never stopped. In August this year, the European Union withdrew 8 Chinese PV companies' price undertaking qualifications in succession, making "exited" Chinese PV companies up to 16 currently. At the same time, in the first half of this year, the amount of China's PV products exported to Europe has fallen sharply by 30 percent. In the face of outside concerns, experts said that the diversified pattern of global PV market has been gradually formed currently. Along with the market share of Chinese PV companies in the emerging markets like India and Africa rising, the risk resistance capacity of China's PV industry has significantly enhanced.
EU PV market continuing to shrink
Some of Chinese PV companies being disqualified in the implementation of China-Europe PV price undertaking has indeed affected China's PV products exporting to Europe to a certain extent, but it is not the fundamental reason for the decline of the amount of China's PV products exported to the Europe. Data show that from June 2015 to August 2016, the European Commission withdrew totally 16 Chinese PV companies' price undertaking qualifications in 7 times. These 16 disqualified companies can be divided into two categories: one category including 4 companies is voluntary withdrawal; the other including 12 companies is suspected of violating the price undertaking agreement.
In view of the downturn of China's PV products exported to the EU, Shen Danyang, spokesman of the Ministry of Commerce, pointed out that the EU trade restrictions have affected China's PV exports to some extent, but the main reason for the decline in exports is that the members of the European Union have gradually cancelled the incentive policies for PV application, resulting in serious market shrinking and the decline of China's export volume and export prices.
Data show that the EU market has shrunk from a peak PV installed capacity of 22.4 GW in 2011 to 8 GW in 2015. China's exports to the EU in 2015 were 3.46 GW within the price undertaking, the equivalent of EUR 1.785 billion.
"The situation will worsen if European Union continues to maintain restrictions, and it is not conducive to the long-term interests of the EU. It is hoped that the European Union terminates the PV anti-dumping and countervailing measures as soon as possible to make the PV market returning to normal state and the mutually beneficial and win-win situation realized veritably," said Shen Danyang.
Continued strong of market diversification in Asia Pacific
It is noteworthy that the global PV market is undergoing significant changes currently that China has become the world's largest PV market, the diversification of Asia Pacific market is continuing to be strong and the importance of increasingly shrunk EU PV market continues to decline among the global markets.
In particular, after the rush of installation and PV tariff subsidies in the first half of the year, China PV market demand appears a brief fall. Since the second half of the year, the rapid decline in the price of downstream components has driven the price in medium and upper reaches continuously dropping. Facing to the demand saturation in the domestic market and the boom of overseas markets such as India, China's first-tier PV companies have increased their efforts to develop overseas markets and find potential opportunities in the markets along "One Belt and One Road".
According to the latest report of an authority Mercom Capital, as of August this year, the accumulative installation capacity of solar power generation in India has been more than 8.1 GW, and that of this year has reached 2.8 GW. It is expected that in 2016, India will have new installed capacity up to 4.8 GW. Under the temptation of huge market prospects, the major PV companies have shifted from the original European and American markets to India, South America, Africa and other emerging markets.
Chen Kangping, CEO of Jinkosolar, said: "The industry is facing challenges, but it is anticipated that in the fourth quarter of 2016, there will be a rebound. In the second half of the year, we have locked a number of large orders. It is expected that the markets in Latin America, India and Japan will rapid develop, thus the geographical shipping distribution of the company will be more balanced."
After years of operation, ZnshineSolar has developed a number of PV power generation projects in Indonesia, Japan, Saudi Arabia and other global emerging markets; among them, the power plants' total size developed in Japanese market alone has exceeded 500 MW. With the rich experience in PV manufacturing and the ability in product development, the company has contacted a number of potential partners in India market and plans to share its experience in manufacturing with the potential partners in India, so as to actively build and improve the component production capacity in India," revealed Wang Guifen, chairman of ZnshineSolar.
Exploiting the collaboration advantage of whole industry chain
Viewing from the international market, the PV industry has been fully flowering. The global installed capacity continues to grow and the popularity rate is increasing. The International Energy Agency forecast, it is expected to grow to 123 GW in 2030, and a market demand peak of 200 GW every year may occur between 2030 and 2040. A report from US Bloomberg New Energy Finance said that by 2030, the solar energy will surpass other new energy technologies to become the most inexpensive energy.
In the future, the global PV installed capacity growth will mainly come from the emerging markets. To firmly occupy these markets, Chinese PV industry must give full play to the advantages on market, technology and whole industry chain collaboration to build an upstream and downstream industry linkage pattern including the component manufacturing and the power plant development and give full play to the advantages of the coordinated growth of upstream and downstream.
"Although China has established a number of advantages in emerging markets, but the export environment of PV products is still not stable that overseas "double anti" investigation for China PV products occurs from time to time." An insider said that viewing from the long-term development, enterprises go abroad alone may encounter difficulties, thus the entire industry should cooperates closely to improve the overall level of responding and the risk resistance ability.
Compared to mature markets in Europe and the United States, the emerging markets are mostly located in developing countries and regions that are not mature enough for the relevant industries. To open up these markets, it is more necessary to adapt to the local conditions, in-depth understand the climate characteristics, political situation, laws and regulations in local markets, and develop local teams. Qian Jing, vice president of Jinkosolar, said that enterprises must first understand the local policy differences, the application differences, and the customer buying habits differences, and then select the appropriate matching products, promotion channels, partners and cooperation methods. "The key is brand, cost and service. This is the basic conditions of success".