China Installs Better than Expected 44 GW of Solar Capacity in CY 2018
There is a 21% drop in solar installations YoY
In the calendar year (CY) 2018, China installed 44.26 GW of solar photovoltaic capacity. The country installed 9.76 GW of solar PV capacity in the fourth quarter of CY 2018.
China’s cumulative solar installed capacity now stands at 174 GW, which is almost equal to India’s entire target for renewable energy up to 2022.
According to China’s National Energy Administration, out of the 44.26 GW of solar PV installed in 2018, 23.3 GW (53 percent) were utility-scale PV power projects while the remaining 20.96 GW (47 percent) came from distributed generation category.
Compared to 2017 in which China installed around 53 GW of solar PV, 2018 witnessed a 21 percent drop in installations. The installation slowdown was expected after China’s policy change to reduce solar installations following a massive subsidy backlog.
Previously, Mercom reported that China had installed 34.5 GW of solar PV capacity in the first three quarters of 2018. After the third quarter of CY 2018, Asia Europe Clean Energy (Solar) Advisory (AECEA) forecast had lowered China’s solar capacity addition for 2018 from 40-45 GW to 30-35 GW.
In June of 2018, China’s National Development and Reform Commission (NDRC) had imposed a cap of 10 GW on distributed generation projects for the year 2018. The installation figure of distributed generation projects at 20.96 GW is almost twice the cap fixed for 2018.
Back in November 2018, China was evaluating the feasibility of increasing its solar installation target to 250-270 GW by 2022.
According to Li Chuangjun, Deputy Director of the Department of New Energy and Renewable Energy, China, “Photovoltaic power generation has shifted from a high-speed growth phase to a high-quality development phase. In 2019, we will continue to promote the development of the photovoltaic industry by promoting the high-quality development of photovoltaic power generation and maintaining a reasonable development scale and development pace of the photovoltaic industry. Further, improve the construction management of photovoltaic power generation. According to the actual development of the industry, the development of photovoltaics in 2019 will be divided into two major parts: one is a photovoltaic power generation project that does not require state subsidies, and the other is a photovoltaic power generation project that requires state subsidies.”
“A 21 percent drop in installations is better than many forecasts that were predicting a 30 to 40 percent decline year-over-year. Solar demand fluctuations in China affects the markets globally. Higher than expected demand could mean tighter supplies and higher component prices while a drop in demand would mean oversupply and excess inventory leading to another module price crash, which could be good for project development but bad for suppliers,” said Raj Prabhu, CEO of Mercom Capital Group.
Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.