China solar photovoltaic installed capacity set to rise in 2020

May 7, 2009 - AsiaPulse

China's solar PV installed capacity is likely to reach 10,000-20,000 megawatts by 2020, with the implementation of its solar photovoltaic (PV) roof plan and other supportive measures, China Securities Journal quoted Wang Zhongying, head of the Renewable Energy Development Center of the Energy Research Institute (ERI) as saying.

The predicted capacity is far higher than the government's original plan, which targets at 1,800 MW of solar PV installed capacity by 2020.

China has announced a plan to build the country's largest solar PV project in Dunhuang, Gansu, with a primary installed capacity set at 10 MW.

Bidding for the project, enterprises have offered an average power price of 1.5 yuan/kwh.

Although the price is still far higher than the 0.6 yuan kwh price of wind-generating electricity selling to grids and the 0.3 yuan/kwh price of on-grid thermal power, it can reflect the sharp decline in the solar PV costs, said Wang.

Calculated on the basis of current solar PV cost and on-grid thermal power price, the Chinese government needs to give one yuan of subsidy to each kwh of electricity generated from solar power, Wang noted.

Wang also stated that the Chinese government was likely to draw up more favorable measures to encourage investment in solar power projects.

China announced a solar PV roof plan in March, promising to grant a 20 yuan/watt-peak subsidy to solar PV projects whose single installed capacity exceeds 50 kWp.

Now, China-based solar PV product makers like SunTech Power Holdings Co., Ltd. (STP.NYSE), Solarfun Power Holdings Co., Ltd. (SOLF.Nasdaq) and the China Technology Development Group Corporation (CTDC.Nasdaq), are suffering significant losses due to foreign market shrinkage and a large number of provisions against price drops.