ABSTRACT
Despite existing studies on China’s solar panel production (see, for example, the study of Douglas Gress on how Chinese producers enrolled in global networks in this issue) and related government policies to promote the industry, there is no updated research to capture the recent change, albeit subtle and gradual, in government approaches of subsidizing and supporting the industry in favour of the domestic demand side. Under the dynamic context of China’s state capitalism that is evolving from a mercantile phase to a new stage with policy priority on domestic demand, Zhang and Andrews-Speed’s concern has been partially answered by the latest fine-tuning in the direction of government subsidies, although such policy shift is yet to be significant enough to breed a domestic market of sufficient scale to absorbmanufacture oversupply that has encountered an overseas boycott.
5. Findings 5.1 Overheated solar PV manufacture decoupled from underdeveloped solar power generation Over the past decade, the gravity of solar PV production has shifted from the United States, to Japan, to Europe and to Asia, especially China, which has quadrupled its poly-
silicon solar panel manufacture capacity between 2009 and 2011. A total of 63% and 64% of cells and modules produced in 2012 were made in mainland China, which is a marginal increase over 2011 (62% and 59%) (Mehta 2013). As mentioned by Gress, price sensitivity in the global solar PV market has persisted, with price competitiveness of Chinese products leaving Chinese firms well positioned globally. China’s existing production capacity of solar panels is about 150% of the global real demand, and in just four years between 2009 and 2012, the international price of solar panels had been cut by more than 75% largely due to an aggressive capacity build-up in China. The share of made-in-Europe modules continued to fall, from 14% in 2011 to 11% in 2012, and Japan’s share dropped from 6% to 5% (REN21 2013, 47). The top 15 solar PV module manufacturers accounted for half of the 36 GW (gigawatt) produced globally; nine of these companies hailed from China (Figure 2).
