Who is going to save the PV "scar"?

Starting from the basic laws of the market economy, in the oversupply environment, bankruptcy is a normal phenomenon and an important means for the market to achieve a virtuous cycle of self. Therefore, the real challenge for China's PV companies is not the anti-dumping case. It is not even what many experts call the issue of over-reliance on the export market. The real problem is that the price mechanism no longer plays a role under the soft constraints of corporate budgets: various local governments Hidden pockets make excellent companies unable to stand out in the market competition.

Recently, a number of national authorities have intensively introduced a series of favorable policies to help the photovoltaic industry in its most difficult period with a combination of punches: The Ministry of Commerce initiated a “double counter” investigation into polysilicon companies in the EU, and at the same time, European and American photovoltaic subsidies were discriminatory. The measures appealed to the WTO; State Grid announced that starting on November 1, photovoltaic power projects with capacity of 6 MW and below could be applied directly to the local grid company; several major photovoltaic giants were negotiating nationalization. It can be expected that after the implementation of the policy of actively expanding the domestic market, many domestic photovoltaic companies will gain a chance in the short term. However, the practice of local governments to rescue them is, to a large extent, a frustrating move to prevent a large number of PV companies from being forced into bankruptcy by huge amounts of debt. Recalling that the photovoltaic industry has fully blossomed into a surplus industry in a few short years. From the perspective of the long-term development of the industry, the current practice of the government to actively enter the market to rescue PV companies may not be the best choice. How to guide the PV industry to return to the market? Within the framework of virtuous circle should be the top priority for the relevant departments to consider.

At present, the dilemma of PV companies lies in over-reliance on overseas policy markets. Data show that in 2008, China's top ten photovoltaic companies accounted for 30% of the global production capacity; in 2010, this figure even exceeded 50%; in 2012 it further increased to about 63%. The consumer market facing such a large number of production capacities is mainly the European and American markets. In 2011, China's photovoltaic industry realized a sales income of approximately US$28 billion, of which exports amounted to approximately US$25.8 billion and foreign dependency remained at approximately 90%. Such an astonishing degree of foreign dependence has caused the foreign markets to show signs of trouble, and domestic photovoltaic companies cannot afford it. Therefore, under the background of the “double reverse” against China in the United States and Europe, profits have fallen sharply, and it is inevitable that the industry will quickly fall into predicament. From this point of view, the "double counter-insurgency" between the United States and Europe is just a matter of letting the photovoltaic company's crisis come earlier.

In the short term, China's photovoltaic industry has grown from a prosperous development trajectory, and the government’s hands can be said to follow suit. For example, the growth history of Wuxi Suntech and Jiangxi LDK is a typical example: Shi Zhengrong returned to Jiangsu Wuxi to start a company with technology and 400,000 US dollars in 2000. Wuxi Suntech succeeded in 2005 with generous funding from local governments and state-owned enterprises. Listed in the United States; Peng Xiaofeng established Seville in Xinyu City, Jiangxi Province in 2005. He also received full support from local finance and embarked on the overseas listing process two years later. Relevant data show that so far, nearly 300 cities across the country have vigorously developed photovoltaic solar energy industry, more than 100 cities proposed to build a photovoltaic industry base, and more than 10 cities proposed to build a dual-billion-dollar photovoltaic industrial base. Because priority is given to supporting development, PV companies will also receive a large number of preferential policies. The direct result of the government's active promotion is that it has attracted too much capital to invest in this industry. The market that was originally in short supply has rapidly overcapacity due to a large increase in the number of companies in a short period of time.

What's more serious is that the excessive involvement of government forces has caused the normal development path of the photovoltaic industry to be disturbed and even deviated from the laws of the market. The simple replication of Wuxi Suntech and the LDK model directly led to severe competition in the low-end homogeneity of PV products and the proliferation of industrial bubbles. The most prominent contradiction lies in the fact that due to the high cost of photovoltaic power generation and the lagging of grid-connected technologies, the domestic market can only digest less than 5% of the output. A large number of photovoltaic manufacturing products have to seek expansion into overseas markets. Some of the production needs to be absorbed by overseas markets. Obviously, if everything can operate and operate according to the laws of market economy, the photovoltaic industry is unlikely to have a current crisis. After all, this industry has only just begun and it is unlikely that there will be a serious overcapacity, like a traditional surplus, even if it is a relative surplus. In this regard, if there is no strong “push” from local governments, the PV giants will not be able to reach their current size within a few short years, and it will be even less likely that they will have huge debts.

Past experience guide for the future. The lessons learned from the development of the photovoltaic industry are to promote the healthy and better development of the industry in the future. The greatest consequence of the local government's efforts to support the photovoltaic industry is that the entire industry has a high degree of reliance on the government and policies, which also provides the United States and the European Union with "double opposition" opportunities and evidence. Therefore, in the face of the current crisis in the photovoltaic industry, what the government should do is not how to save the company. Instead, it is necessary to calmly think about how the government’s tangible hands should be regulated and how it really is for the development of the enterprise. Create a good environment. Only by truly solving this problem, the development of the photovoltaic industry will reduce the troubles and costs of growth. Therefore, the government's current assistance can only make photovoltaic companies temporarily avoid a bigger crisis, but it will make the entire industry take a longer time, and the entire industry cannot grow bigger and stronger.

One strange phenomenon is that although the photovoltaic industry has already suffered a loss in the entire industry, no one company has thus closed down. In the United States, there have been three consecutive PV companies that have a large share of the market within a month. Since the second half of 2009, domestic PV module manufacturers have started full expansion. By the end of 2011, the country’s total production capacity was about 40 million kilowatts. In that year, the global PV market installed capacity was only about 28 million kilowatts, and more than half of the country’s photovoltaic capacity was idle. Starting from the basic laws of the market economy, in the oversupply environment, bankruptcy is a normal phenomenon and an important means for the market to achieve a virtuous cycle of self. Therefore, the real challenge for China's PV companies is not the anti-dumping case. It is not even what many experts call the issue of over-reliance on the export market. The real problem is that the price mechanism no longer plays a role under the soft constraints of corporate budgets: various local governments Recessive pocket bottom, making excellent companies can not stand out in the market competition.

In particular, we need to remind that the photovoltaic industry in China is based on crystalline silicon solar cells. Although the concept of using solar energy is very environmentally friendly, the production process of solar panels will generate greater pollution. The large-scale subsidies for PV projects are equivalent to using financial funds to pay for pollution production and to make a contribution to the development of energy-saving industries in other countries. Therefore, it is probably not the government that can really save the photovoltaic industry. It can only be the market: the survival of the fittest is more efficient and thorough, and it can also allow enterprises with truly advantages to obtain sufficient space for development and become bigger and stronger.

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