If 2012 is the sad year of China's photovoltaic industry, then September 6 this year can be regarded as the sad day of domestic PV companies. On this day, the EU initiated a "double opposition" officially filed for China, and the prospects for domestic PV companies are overcast.

Perhaps affected by this, PV companies have even lost interest in participating in the exhibition. The “12th China PV Conference and Beijing International Photovoltaic Exhibition” held in Beijing from September 5th to 7th was sparsely populated and the scene was deserted. Due to the small number of exhibitors, only one and a half exhibition halls were exhibited. The exhibitors told the reporter of "New Finance": "It doesn't mean anything. The leaders will go and see."

In the face of the EU's "double opposition" and industry downturn, many companies have self-rescue through transformation, the main way is to exit the photovoltaic manufacturing field and switch to photovoltaic power plants in downstream applications. Hairun Photovoltaic announced on September 14 that it will invest 490 million yuan to build two photovoltaic power stations; Zhongli Technology and Poly GCL also announced plans to build photovoltaic power plants at the end of August.

The construction boom of a photovoltaic power station is quietly going on, but can this really solve the current decline in the photovoltaic industry? Can the power station really digest both capacity and stable returns?

Loss across the industry

Foreign investigations into the "double-reverse" investigation of China's photovoltaic industry have been unsettled. In May of this year, the United States conducted a "double-reverse" investigation on the domestic photovoltaic industry, and made a preliminary ruling on 31% to 250% anti-dumping duties against a number of Chinese companies. The US investigation has not yet ended. The EU announced in September this year that it initiated an anti-dumping investigation on China's photovoltaic cell products, and the scope of the investigation products has been further expanded.

Unlike the US “double-reverse” only for solar PV module products, the scope of the EU survey includes the entire industry chain of silicon wafers, cells and components, which makes it difficult for Chinese PV companies to avoid punitive tariffs. It is understood that the EU anti-dumping investigation involved more than 20 billion US dollars, equivalent to nearly 130 billion yuan, is by far the world's largest single trade dispute.

Europe is the largest market for PV products in the world today, and is also the main export area for PV products in China, accounting for 70% of China's total PV battery exports during the same period. In contrast, the US market accounts for only 20% of total exports. Therefore, the EU's "double-reverse" filing has made the country's already bleak photovoltaic enterprises worse.

According to data released by the China International Photovoltaic Industry Development Forum in 2012, in the first half of this year, China's solar PV products exports fell for the first time after maintaining six consecutive years of rapid growth. The total export value was US$12.894 billion, down about 30% year-on-year.

In fact, the domestic PV industry has fallen into a loss-making situation in the whole industry. The decline in the performance of PV listed companies in the first half of the year is a strong proof. According to the statistics of straight flush data, in the first half of this year, the total operating income of 69 A-share PV concept listed companies was 109.2 billion yuan, a year-on-year decrease of 3%. Due to the sharp decline in product prices and gross profit margins, the net profit of these companies was only 3.7 billion yuan, a 60% year-on-year decrease compared with the net profit of 9.3 billion yuan last year.

In the first half of the year, there were also a sudden increase in the number of companies with losses in the first half of the year. As a result, about 30% of the companies listed in the first half of the year had losses, and the cumulative loss was close to 2 billion yuan. In the first half of last year, there were only five PV listed companies.

After the photovoltaic giants LDK and Suntech Power are exposed to bankruptcy, a large number of small and medium-sized PV companies in the Jiangsu and Zhejiang provinces are facing bankruptcy. Many PV production equipments are waiting to be sold, and some even sell the entire production line at a very low price. Some bosses have already run.

The low-end photovoltaic manufacturing industry is the hardest hit by capital withdrawal. The reporter learned that many small-scale photovoltaic enterprises in Jiangsu and Zhejiang have closed their doors. The large-scale Zhongsheng Optoelectronics Group in Jiangsu Province has announced the closure of its wafer factory due to a serious loss.

Wei Qiang, president of Green New Energy Company in Hebei, said that a year ago, the PV modules sold in the market could still be sold for 1 Euro/W, which has now been reduced to 0.48 Euro/W. At the same time, the exchange rate between the renminbi and the euro is still rising, which makes photovoltaic companies suffer from exchange losses while suffering from large price drops.

Transformation of photovoltaic power station

Due to the increasingly difficult life in the middle and upper reaches of photovoltaics, many PV companies have transformed and began to search for living space in downstream PV power plants. On the one hand, it is to digest the existing excess capacity, and on the other hand, it hopes to obtain a relatively stable return.

On August 31, the listed company Zhongli Science and Technology released a private placement plan, with a proposed issuance of no more than 170 million shares and a fundraising of about 1.6 billion yuan, mainly for the Gansu Photovoltaic Power Generation Project and the Puerto Rico Photovoltaic Power Plant.

Zhongli Technology is not the only PV company to build a power station. Just before Zhongli Technology released the news, two other PV companies, GCL-Poly and Yinxing Energy, also expressed their intention to invest in the construction of photovoltaic power plants.

Recently announced the construction of the power station is Hairun Photovoltaic. On September 14, Hareon Solar announced that it will invest 490 million yuan to build two photovoltaic power plants, one is the 20MW photovoltaic power generation project in Jinchang, Gansu, and the other is the 20MW photovoltaic power generation project in Keping County, Xinjiang.

In fact, over the past year or so, many domestic PV companies have begun to “go down” to extend the overcapacity solar modules to the downstream PV power plants. The reason why these enterprises are optimistic about the power station is that the state has introduced relevant incentive policies for photovoltaic power station projects.

According to the "Twelfth Five-Year Plan for Solar Power Development" issued by the National Energy Administration on September 12 this year, "by the end of 2015, China's solar power installed capacity target is more than 21 million kilowatts." Some insiders said that this actually left the top of the "Twelfth Five-Year" solar installed capacity.

It is investment enthusiasm that has spawned some new application models for photovoltaic power plants. The vegetable shed of photovoltaic power station, which recently appeared in the farmland of Shouguang, Shandong, is a new product. This vegetable greenhouse with photovoltaic power generation is the first high-tech energy greenhouse integrated with solar photovoltaic agriculture. It is currently finalizing the grid-connected power generation at the end of September. Preparation.

Mr. Sun, the Huatian New Energy Company responsible for the operation of the project, believes that solar power plants are installed on the greenhouses. Behind this long industrial chain is the win-win situation of farmers, enterprises and the government.

It is understood that the base needs to invest about 40 million yuan. After grid-connected power generation, according to the on-grid price of 1.15 yuan per degree, the annual income is at least 6 million yuan, and the cost can be recovered in about 8 years. In addition, this year's power generation capacity of 1 megawatt can also receive 8 million yuan of government support.

For PV companies, the greater attraction is that such a power station does not occupy land resources, and can use the top of the greenhouse to achieve power and agriculture. The traditional way of building photovoltaic power plants, generally for industrial use, is very costly. In economically developed areas such as Shouguang, the price of industrial land has reached 400,000 yuan per mu, and it is difficult to approve it. The land cost of this 180-acre greenhouse power station is almost zero.

Project risk and financial pressure

Can PV companies build power stations that can both digest capacity and achieve stable returns? At present, pressure and risk are at the same time. A photovoltaic industry researcher said that this is only a temporary way to digest capacity, and can not solve the overall decline of the industry, and there are many risks.

According to its introduction, there are currently two modes of building photovoltaic power plants, EPC mode and BT mode. The BT model can achieve higher profits than the EPC model, but the first condition is to obtain approval from the local NDRC.

As a result, the problem has arisen. Although many companies are going to do photovoltaic power plants, not every one can get approval for the “roads” from the local development and reform commission. According to the "New Finance" reporter, even if the BT model is widely optimistic, it is not a profit.

At present, the domestic buyers of photovoltaic power stations are actually the five major power groups. On some of the larger projects, the NDRC is more willing to cooperate with the five major power groups, and it is very difficult for private enterprises to participate. The local development and reform commission of Qinghai Province has directly allocated power station projects to large power groups and energy companies.

However, since the installed capacity of each photovoltaic power station is relatively small, the five major power groups will not operate completely, but will cooperate with the photovoltaic module factory or the developer. After the photovoltaic enterprise produces the components to be shut down, the power group will proceed again. The acquisition has given private enterprises a certain opportunity and space to participate. However, this model makes private enterprises inevitably accept the price reduction of the power group, and the profit margin is not certain.

Another big risk is whether the project will eventually run. According to Wei Qiang, president of Green New Energy Company, although local governments often invite PV companies to build power stations during investment promotion activities, the issue of grid-connected photovoltaic power has not been answered. “If there is no network, a power station will be built. It can only be sunbathing." Many local governments have introduced photovoltaic power station projects for economic development and large-scale, but often they can't keep up with the supporting work in the later period.

Building a photovoltaic power station requires a lot of money, which is another pressure faced by photovoltaic companies to build power stations.

Take Zhongli Technology as an example. Although the net profit in the first half of this year was 111 million yuan, the net cash flow generated by the company's operating activities was -305 million yuan. At the same time, the company's short-term loans were 1.694 billion yuan, long-term loans were 890 million yuan, and bonds were paying 800 million yuan.

The resource pressure of Yinxing Energy is also not small. The company's operating income in the first half of the year fell by more than 40%, and the net profit of more than 20 million yuan was not even half of the project capital expenditure. Although the company's total assets are about 5 billion yuan, the debt amount is as high as 4.451 billion yuan. In addition, the project construction project needs to borrow more than 200 million yuan from the bank, and the company's debt situation will further deteriorate.

The industry generally believes that photovoltaic enterprises must build power stations downstream, one must fight the relationship, and the second must fight for funds. "If there is no money, it does not matter, you must be cautiously involved, otherwise it will enter a trap." A PV person in Baoding, Hebei Province Say. Author: Lai Zhihui


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