Party Is Over For Dirt-Cheap Solar Panels, Says China Executive
The president of a top-10 maker of solar panels said the global solar power industry is about to lose a major competitive windfall as prices of Chinese-made solar panels begin to recover after a collapse last year. "The party is definitely over," said Eric Luo, president of China's GCL System Integration Technology Co. Reuters reports: Solar panel prices tumbled around 30 percent last year after China, the world's largest producer, cut subsidies to shrink its bloated solar industry, pushing smaller manufacturers to the brink of collapse. To raise cash and stay afloat, manufacturers cleared inventory and diverted sales offshore, sending prices into a downward spiral - offering up a windfall for solar power generators and investors in solar farms. Luo, speaking to Reuters at the World Economic Forum in the Swiss ski resort of Davos this week, said GCL's vertically integrated business model cushioned it from the downturn in prices as its solar farms benefited from cheaper panels. The pain will mostly be felt by smaller Chinese producers, which lack international supply chains, triggering industry consolidation or forcing them to close, he added. Luo said solar panel prices were already stabilizing and he expected them to rebound by 10 to 15 percent as the Chinese industry consolidates over the next year or two. Luo also said that China was getting to the point where the solar industry could operate without any form of subsidy. Northwest China, where the sun is more plentiful and land is less expensive, has already reached that point, he said.
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