As an important branch of new energy sources, the domestic photovoltaic industry has demonstrated the momentum of bottoming out. Recently, GD Power Development issued a public notice that the company plans to invest RMB2.53 billion to build a joint venture polysilicon project in Inner Mongolia, and the scale of total production capacity is 10000 tons.  After established a total capacity of 5,000 tons of polysilicon in Ningxia in October last year, this is the other big investment from the power generation giant in PV industry.

In addition to GD Power, since the end of last year, the Huadian Group, Datang Group, Shenhua Group and other "national team" have increased investment in the photovoltaic industry. The "national team" has gradually appeared in the photovoltaic field to capture their respective territories. Together with the push from the country's new energy development strategy, photovoltaic industry is ushering in a new round of investment boom.

A large-scale of national teams are entering when the slowdown of economy .PV industry can be said to be in the most difficult time now. The price of polysilicon has gone down to the recent spot price 50-70 U.S dollars from 500 U.S. dollars per kilogram in September, and October last year, as well as it has been shown the signs of overcapacity. Hao Xiaohui, the chief strategist of New Era said that domestic polysilicon production capacity in 2008 was about 15000 tons and it is expected to 2.5 million tons in 2009. The price of polysilicon collapses, and this trend is difficult to reverse in short time.

However, the trough is often the best time to invest. Recently, the Hong Kong-listed China Association Bao Lixin Energy Holdings Limited announced that it will buy 100% stake of Jiangsu Silicon Industry Technology Development Co., Ltd. at the price 26.35 billion yuan RMB. Because they are aware of this point, they invested in Jiangsu Zhongneng which is facing the financial difficulty.

China GD Power Group took fast action fast to invest 5 billion yuan RMB in setting up a polysilicon project in Ningxia in October 2008. The construction is in two phases with an annual output of 5,000 tons polysilicon. Coupled with the polysilicon construction projects which was invested in 2.53 billion yuan RMB, it plans to produce 300MW photovoltaic cells in 2011and 600MW in 2012.

Huadian Group in Shanghai Putuo also starts to construct a 1.4MW solar power project. Moreover, they have commenced the preparation work in Qinghai, Gansu, and Inner Mongolia. Datang Group, involved in the Dunhuang concession tender solar energy project, has completed the pre-feasibility study report. The relevant documents were being approved in March of this year. China Shenhua Group has done a preliminary research and experimental project in solar. The next step will be to carry out 1MW scientific research and 1MW roof-top  plan in Shangyi areas of Hebei Province.

Policy support to boost domestic market

Zhao Yuwen, China Vice Chairman of Renewable Energy Association and director of the photovoltaic sub-association said that the State should start the photovoltaic domestic market as soon as possible. "If China has installed as long as 1 / 3 of photovoltaic products in the home, the financial crisis will not be apparent. In the long run, if the policy support is in place, there is still tremendous room for the growth of photovoltaic industry, "he said.

To start the domestic demand, the Ministry of Finance and the Ministry of Construction put forward the "Solar Roofs Plan" in March this year, which qualified solar photovoltaic demonstration project for building applications for up to 20 yuan / watt subsidies. Professional Committee of Shanghai Solar Energy Society, director of optoelectronics, the professor of Shanghai University, Wei Guang Pu said that the subsidies has covered half of raw materials cost, including cells, power plants, although only in the main final application areas. The open-up of the downstream product markets means that the upper-steam can also reacha full development. In June, the National Energy Board official said that the new energy planning at the national level will be issued in due course, and wind power and photovoltaic energy will have a considerable proportion in the new planning.

"A series of policy support is a tonic for the PV industry," says Zhongyuan Securities Poon Hang-jun.  From the experience in countries around the world shows that the introduction of photovoltaic subsidy policies all play a significant role in promoting the domestic market. CITIC Securities and Donghai Securities indicated that 20 yuan / watt of subsidies can be broadly covered 40-50% of the system cost, as compared with Europe and the United States and other developed countries. The strength of subsidies is roughly equal. It will greatly stimulate domestic demand for photovoltaic applications.

Although the PV investment projects are entering into a new round of investment peak, the Secretary-General of Chinese Renewable Energy Society Meng Xiangan said that currently, the most important factor restricting the development of photovoltaic industry is that the internet electricity price has not been solved. "Only when the system for the on-grid price of photovoltaic power finalizes, the companies in the status of wait-and-see will take real action, and the photovoltaic industry will be likely to usher in blowout like growth," he said.

Source: China Energy News