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Party is over for dirt-cheap solar panels, says China executive

reuters.com

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Re: Party is over for dirt-cheap solar panels, says China executive

#21

Post by zorga »

porpoisely wrote: post #17
jayd16 wrote: post #13

Earlier quoted context omitted.

[flagged]

Tariffs help US businesses and american workers. It's why the first major act of congress was a tariff. https://www.encyclopedia.com/history/encyclopedias-almanacs-... The US economic might was built on tariffs protecting american businesses. We became the largest economy in the world in the late 1800s due partly due to tariffs. It's also why europe, japan, korea, china, etc used tariffs to become economy powerhouses…

> Tariffs help US businesses and american workers. It's why the first major act of congress was a tariff.

Tarrifs are taxes on US businesses and american workers, no it doesn't help them, it makes everything more expensive for everyone.

The only valid use case for a tarrif is to subsidize and maintain a local industry that is critical to national defense that we can't let be run out of business by cheaper foreign goods.

Re: Party is over for dirt-cheap solar panels, says China executive

#22

Post by philipkglass »

stcredzero wrote: post #11
ChuckMcM wrote: post #3

Always over until it starts again. Note that the party is over (in this case) because it is threatening smaller businesses, not because there is a lack of capacity or that the "big guys" couldn't still make money at the reduced rate. In every industry where I have been aware of this this situation coming up (voluntary reduction in production in order to shore up prices), it works for a while and then people "cheat" a…

Often, one sees industries making changes because market forces have made the transaction cost of manufacturing too onerous. Some industries in that case will consolidate and vertically integrate. If the pain from uncertain prices and supply gets too great, could the solar industry start with mergers and vertical integration? Or is it far too early for that?

Yes, mergers have been common in solar for a while.

This is one of the top manufacturers today:

https://www.hanwha-qcells.com/

A Chinese cell and module manufacturer acquired a Chinese ingot manufacturer. Korea's Hanwha Group subsequently acquired this merged Chinese entity as well as the German solar manufacturer Q-Cells. The merged Hanwha Q-Cells is vertically integrated from cells to modules.

A handful of manufacturers like GCL have vertically integrated even further:

- Refined silicon production

- Ingot production from purified silicon

- Wafers from ingots

- Cells from wafers

- Modules from cells

I don't know if that depth of integration makes sense long-term or not. Some companies have been burned in the past as they integrated with producers that weren't close enough to the leading edge. All of these steps are evolving rapidly in small increments; a vertically integrated producer has to keep pretty close to the leading edge at every stage if they don't want to see their integration advantages reverse.

Re: Party is over for dirt-cheap solar panels, says China executive

#23

Post by gumby »

If you want to invest in or speculate in (i.e. time your installation on your house) it looks like the model to follow is the historical DRAM market: a largely undifferentiated commodity market that depend mainly on cap ex and scale, thus subject to boom and bust as technologies changed (or failed to).

the fact that they are both silicon technologies I think is tangental

Re: Party is over for dirt-cheap solar panels, says China executive

#24

Post by jartelt »

The price of the PV modules only makes up like 1/3 the cost of a utility scale solar installation and like 1/5 the cost of residential installations. A 10-15% increase in module cost will not slow solar adoption that much. The solar train will keep chugging along.

We'll eventually get to a point where we generate 5% of the world's power with solar and people will still underestimate its impact and will still claim its too expensive to scale...

Re: Party is over for dirt-cheap solar panels, says China executive

#25

Post by somedudetbh »

ChuckMcM wrote: post #3

Always over until it starts again. Note that the party is over (in this case) because it is threatening smaller businesses, not because there is a lack of capacity or that the "big guys" couldn't still make money at the reduced rate. In every industry where I have been aware of this this situation coming up (voluntary reduction in production in order to shore up prices), it works for a while and then people "cheat" a…

This is a well-studied phenomenon known as Cartel Theory: https://www.cambridge.org/core/journals/business-history-rev...

Re: Party is over for dirt-cheap solar panels, says China executive

#27

Post by jonknee »

viburnum wrote: post #26

China should continue to subsidize solar so they eatablish a completely dominant position, then use their navy to start sinking oil tankers. That's our best hope for salvaging Earth's climate.

That would also throw throw us into a world war that would devastate the planet, but hey.

Re: Party is over for dirt-cheap solar panels, says China executive

#28

Post by coldtea »

jayd16 wrote: post #13
tossaccount123 wrote: post #7

no shit, this is what everybody with a brain has warned about China's MO is to subsidize Chinese businesses, restrict foreign competition internally, and steal foreign companies IP until they are bankrupt, while simultaneously being allowed to export their goods to those same countries with no penalty. Then they jack up the prices when all the competition is gone Everybody criticized Trump for the steel and solar tar…

[flagged]

>Tariffs hurt US consumers

US consumers are first and foremost US workers first -- and only consumers in as much as they have a job and they make enough to pay rent, consume, etc.

So while they might not get cheap global shit as easily, they'll be able to get jobs easier...

Re: Party is over for dirt-cheap solar panels, says China executive

#29

Post by baking »

Eli Yablonovitch has spoken extensively about this. Here is one talk (https://www.youtube.com/watch?v=u_K1URyarE0) but I think he makes the point elsewhere that the central government in China told their regional governments that they would need to close down their smaller scale PV production with the result that they all added capacity to meet the minimum causing an even greater production glut.

Edit: I found the source (cued up for 37:25) https://youtu.be/lDxJsa8miNQ?t=2245

Re: Party is over for dirt-cheap solar panels, says China executive

#30

Post by reitzensteinm »

est31 wrote: post #16

Perhaps more worrying than this change is the recent focus on expanding China's coal plants [1]. China already now is responsible for 45% of the global coal electricity. Just look at this diagram [0]. And with their one-belt-one-road initiative, they are building coal plants around the world. [0]: https://www.carbonbrief.org/mapped-worlds-coal-power-plants [1]: https://www.forbes.com/sites/judeclemente/2019/01/23/coa…

China is still only a moderate emitter per capita, though it's caught up to Europe in recent years. Considering the wealth disparity it's a little hard to criticize.
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