Collapse of U.S. Solar Manufacturers Opens Doors for China

Chinese manufacturers now command 70% of the global solar-panel market, analysts say.

By Bill Savadove, AFP

Sept. 20, 2011
China's solar-power companies are emerging as the industry's dominant force after the collapse of foreign competitors, but the new market leaders already are struggling with low prices and overcapacity.

As the workshop of the world, China has used cheap labor and state support to build a solar industry from scratch in just over a decade as part of a broader strategy to move up the manufacturing value chain from cheap toys and clothes.

China is the world's second-biggest oil consumer, and polluting fossil fuels account for 90% of its total energy use. However, the country is making large strides forward in clean energy.

Analysts say Chinese firms now have 70% of the growing global market in solar panels, thanks to aggressive pricing and the collapse of three U.S. competitors in the last two months.

"The position of Chinese players has certainly been enhanced this year," said Tang Xiaodong, a Shanghai-based analyst at independent investment advisory firm CEBM.

"Lower costs are the direction of the industry and the advantages of Chinese firms on this front have been manifested more clearly."

China's solar-panel prices have fallen to around $1.2 per watt of generation, down from about $1.7 last year and much lower than the global average of about $2 in 2010.

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