The birth of the new era of solar photovoltaic energy
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Between US tariffs and the new Chinese policy, the solar industry could end up with more supply than demand, further reducing the selling prices of solar panels.

Two important events affected the photovoltaic industry this year 2018: the 30% tariffs imposed by the United States on the import of solar cells and modules, and the new Chinese measures relating to solar power plants.

As Washington erects high protectionist walls around its economy (in a bid to hit the Chinese market first and foremost), Beijing is emphasizing the support systems that have fueled the national solar race in recent years. On June 1, the People’s Republic announced a drastic and unexpected revision of photovoltaic incentives: the end of subsidies to large power plants and the reduction of tariffs with the introduction of a cap for small plants. distributed.

For the world’s largest solar market, China, today, both in terms of industry and installed capacity, these events are bound to have an impact. The first consequence will obviously be a marked slowdown in the growth of domestic photovoltaics: the new 53 GW in 2017 could be reduced to 30-35 GW this year. The second is a drop in the price of solar panels around the world.

Analysts agree that the actions taken by the United States and China will result in an oversupply of around 34 GW in the market. “There will be a stressful pricing environment in the short term“Explains Cameron Barati of IHS Market.”It certainly has global repercussionsInvestors in the sector reacted to the Chinese government’s announcement by starting to sell stocks. This week, the MAC Global Solar index (which includes more than 30 major photovoltaic companies) fell 7%.

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According to Bloomberg New Energy Finance, the global average selling price (ASP) of modules is expected to decline by 35% in 2018, compared to previous forecasts which estimated the reduction to be between 20% and 27%. However, this slowdown, expected in the second half of 2018, could stimulate demand growth in 2019 and 2020.

On the other hand, the cycle between supply and demand is at the base of the growth of the sector. Between 2010 and 2017, prices for solar panels fell by 80%, due to both increased efficiency and increased production. This process bankrupted many manufacturers, but the cost reduction resulted in an increase of almost 9 times the total installed capacity.