China National Chemical Corp. (ChemChina) is considering the establishment of a conglomerate involving the whole photovoltaic (PV) industry, disclosed insiders from the Chinese chemical titan.
The to-be-formed conglomerate will contain current ChemChina subsidiaries and related operations. Moreover, some private PV firms will be merged, insiders continued.
ChemChina insiders revealed two reasons for the entry into the PV industry. Firstly, the industry has now hit rock bottom and prices of poly-silicon and PV modules have been relatively low. It is good time for integration in the industry.
Secondly, ChemChina has had chemical operations related to the PV industry. The formation of the PV conglomerate will help the company achieve diversified development.
The move has been supported by the State-owned Assets Supervision and Administration Commission of the State Council, pointed out people in the know. It has been part of the company's development planning for the 12th Five-year Plan period (from 2011 to 2015).
Industry insiders have had conflicting opinion about the move, taking risks into account. Gao Hongling, deputy secretary-general of the China Photovoltaic Industry Alliance, requirements for technologies and equipment varied a lot in the whole PV industrial chain, from poly-silicon production and solar power stations.
Moreover, the domestic PV industry has been confronted with overcapacity, and it is not easy for a company to make an all-round foray into the industry, stressed the deputy secretary-general.
With the constant decrease in profits in various parts of the industrial chain, the integration of both upstream and downstream operations has become a trend. Some private PV companies have started extending their industrial china, further stiffening the competition in the industry.
These days, China has attached increasing importance to clean energy, including solar energy. In 2012, the country intends to implement a 3-million-kilowatt PV development plan, marking the first batch in the 2011-to-2015 period, disclosed Liu Tienan, head of China's National Energy Administration (NEA) and vice director of the National Development and Reform Commission (NDRC).
It is the first time that China has unified the planning of PV power generation. Industry analysts pointed out that the 3-million-kilowatt plan may mean an upcoming stricter control of PV power generation approval.
Notably, the NDRC, the country's top macro-economic planning body, released in late August 2011 a fixed price for electricity generated by PV power plants. Moreover, prices of equipment and raw materials like PV cell modules and silicon witnessed a sharp decrease.
Investors have shown greater interest in the PV industry. By the end of 2011, the installed capacity of PV power stations across the country had amounted to 3 million kilowatts with a sharp growth of 400 percent year on year.
No comments:
Post a Comment