IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v72y2014icp188-194.html
   My bibliography  Save this article

Why is there overcapacity in China's PV industry in its early growth stage?

Author

Listed:
  • Wang, Yong-hua
  • Luo, Guo-liang
  • Guo, Yi-wei

Abstract

China has rich solar energy resources with great potential for future development. In recent years, encouraged and guided by China's central and local governments as well as international market, China's PV industry has seen a fast development, with increasingly expanded output. A complete industrial chain has taken shape. In 2011, the PV industry of China saw an annual output value of more than 300 billion RMB and total exports and imports of 142 billion RMB, providing jobs for 300,000 people. The development of China's PV industry mainly relies on the European market. Major factors driving the increase of its production capacity include: huge profits at early stage; great support of governments; lack of effective development planning; low-end processing and manufacturing; low admittance standards. The overcapacity in China's PV industry here refers to overcapacity of PV products such as silicon, polycrystalline silicon, solar cells and PV modules. Impacted by the US Financial Crisis and the European Debt Crisis, the market demand for PV products has been shrinking, resulting in more serious overcapacity of the industry. The Chinese government had hoped that the domestic PV market could absorb the overproduced PV products. However, it seems that, due to insufficient development and uncoordinated incentive system, the domestic PV market may not be able to promote significant change of the situation in a short period. Therefore, it should take a long time to solve the problem of overcapacity.

Suggested Citation

  • Wang, Yong-hua & Luo, Guo-liang & Guo, Yi-wei, 2014. "Why is there overcapacity in China's PV industry in its early growth stage?," Renewable Energy, Elsevier, vol. 72(C), pages 188-194.
    • Handle: RePEc:eee:renene:v:72:y:2014:i:c:p:188-194
    DOI: 10.1016/j.renene.2014.07.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148114003942
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2014.07.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Liu, Jialu & Goldstein, Don, 2013. "Understanding China's renewable energy technology exports," Energy Policy, Elsevier, vol. 52(C), pages 417-428.
    2. Zhang, Sufang & Zhao, Xiaoli & Andrews-Speed, Philip & He, Yongxiu, 2013. "The development trajectories of wind power and solar PV power in China: A comparison and policy recommendations," Renewable and Sustainable Energy Reviews, Elsevier, vol. 26(C), pages 322-331.
    3. Zhang, Sufang & He, Yongxiu, 2013. "Analysis on the development and policy of solar PV power in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 21(C), pages 393-401.
    4. Huo, Mo-lin & Zhang, Dan-wei, 2012. "Lessons from photovoltaic policies in China for future development," Energy Policy, Elsevier, vol. 51(C), pages 38-45.
    5. Chen, Hsing Hung & Lee, Amy H.I. & Chen, Silu, 2014. "Strategic policy to select suitable intermediaries for innovation to promote PV solar energy industry in China," Applied Energy, Elsevier, vol. 115(C), pages 429-437.
    6. Zhang, Sufang & Andrews-Speed, Philip & Ji, Meiyun, 2014. "The erratic path of the low-carbon transition in China: Evolution of solar PV policy," Energy Policy, Elsevier, vol. 67(C), pages 903-912.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ouyang, Xiaoling & Lin, Boqiang, 2014. "Levelized cost of electricity (LCOE) of renewable energies and required subsidies in China," Energy Policy, Elsevier, vol. 70(C), pages 64-73.
    2. Shubbak, Mahmood H., 2019. "The technological system of production and innovation: The case of photovoltaic technology in China," Research Policy, Elsevier, vol. 48(4), pages 993-1015.
    3. Liu, Chang & Liu, Linlin & Zhang, Dayong & Fu, Jiasha, 2021. "How does the capital market respond to policy shocks? Evidence from listed solar photovoltaic companies in China," Energy Policy, Elsevier, vol. 151(C).
    4. Xiong, Yongqing & Yang, Xiaohan, 2016. "Government subsidies for the Chinese photovoltaic industry," Energy Policy, Elsevier, vol. 99(C), pages 111-119.
    5. Kejia Yang & Johan Schot & Bernhard Truffer, 2020. "Shaping the Directionality of Sustainability Transitions: The Diverging Development Patterns of Solar PV in Two Chinese Provinces," SPRU Working Paper Series 2020-14, SPRU - Science Policy Research Unit, University of Sussex Business School.
    6. Zhang, Fang & Deng, Hao & Margolis, Robert & Su, Jun, 2015. "Analysis of distributed-generation photovoltaic deployment, installation time and cost, market barriers, and policies in China," Energy Policy, Elsevier, vol. 81(C), pages 43-55.
    7. Ruhang, Xu, 2016. "Characteristics and prospective of China׳s PV development route: Based on data of world PV industry 2000–2010," Renewable and Sustainable Energy Reviews, Elsevier, vol. 56(C), pages 1032-1043.
    8. Shen, Wei & He, Jijiang & Yao, Shangheng, 2021. "Green industrial policy in the post grid parity era: Governing integrated Solar+ projects in China," Energy Policy, Elsevier, vol. 150(C).
    9. Luo, Guo-liang & Long, Cheng-feng & Wei, Xiao & Tang, Wen-jun, 2016. "Financing risks involved in distributed PV power generation in China and analysis of countermeasures," Renewable and Sustainable Energy Reviews, Elsevier, vol. 63(C), pages 93-101.
    10. Ruyin Long & Wenhua Cui & Qianwen Li, 2017. "The Evolution and Effect Evaluation of Photovoltaic Industry Policy in China," Sustainability, MDPI, vol. 9(12), pages 1-40, November.
    11. Zhang, Lingxian & Wang, Jieqiong & Wen, Haojie & Fu, Zetian & Li, Xinxing, 2016. "Operating performance, industry agglomeration and its spatial characteristics of Chinese photovoltaic industry," Renewable and Sustainable Energy Reviews, Elsevier, vol. 65(C), pages 373-386.
    12. Corwin, Samuel & Johnson, Timothy L., 2019. "The role of local governments in the development of China's solar photovoltaic industry," Energy Policy, Elsevier, vol. 130(C), pages 283-293.
    13. Zhou, Dequn & Chong, Zhaotian & Wang, Qunwei, 2020. "What is the future policy for photovoltaic power applications in China? Lessons from the past," Resources Policy, Elsevier, vol. 65(C).
    14. Sungho Son & Nam-Wook Cho, 2020. "Technology Fusion Characteristics in the Solar Photovoltaic Industry of South Korea: A Patent Network Analysis Using IPC Co-Occurrence," Sustainability, MDPI, vol. 12(21), pages 1-19, October.
    15. Maria A. Franco & Stefan N. Groesser, 2021. "A Systematic Literature Review of the Solar Photovoltaic Value Chain for a Circular Economy," Sustainability, MDPI, vol. 13(17), pages 1-35, August.
    16. Shukla, Akash Kumar & Sudhakar, K. & Baredar, Prashant & Mamat, Rizalman, 2018. "Solar PV and BIPV system: Barrier, challenges and policy recommendation in India," Renewable and Sustainable Energy Reviews, Elsevier, vol. 82(P3), pages 3314-3322.
    17. Wang, Hongwei & Zheng, Shilin & Zhang, Yanhua & Zhang, Kai, 2016. "Analysis of the policy effects of downstream Feed-In Tariff on China’s solar photovoltaic industry," Energy Policy, Elsevier, vol. 95(C), pages 479-488.
    18. Yuan, Jiahai & Sun, Shenghui & Zhang, Wenhua & Xiong, Minpeng, 2014. "The economy of distributed PV in China," Energy, Elsevier, vol. 78(C), pages 939-949.
    19. Yu-Ling Hsiao, Cody & Wei, Xinyang & Sheng, Ni & Shao, Chengwu, 2021. "A joint test of policy contagion with application to the solar sector," Renewable and Sustainable Energy Reviews, Elsevier, vol. 141(C).
    20. Zou, Hongyang & Du, Huibin & Ren, Jingzheng & Sovacool, Benjamin K. & Zhang, Yongjie & Mao, Guozhu, 2017. "Market dynamics, innovation, and transition in China's solar photovoltaic (PV) industry: A critical review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 197-206.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:renene:v:72:y:2014:i:c:p:188-194. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.