Distributed PV power will supersede centralized PV power in China, with the share of its accumulated installation capacities expected to top 40% by 2020, up from 29% now, according to a whitepaper book on China's PV power stations released by PwC China and TÜV of Germany on March 21 jointly, reported Shanghai Securities News.
The paper points to the dropping PV power costs in China, as its sales rate has been lower than common business power rate, predicting that massive PV power will be connected to grid at parity price by 2022, following the first project with grid connection at parity price in late 2018.
Zhai Limin, a PwC China partner, noted that trading focus on China's PV power market is gradually shifting from centralized facilities to distributed ones, at a time when existing centralized ground-mounted PV power stations are undergoing merger and consolidation and diverse investors are stepping into the sector of decentralized PV power. In addition to traditional PV power investors, mutual funds, financial and investment institutions, medium- and large-scale manufacturers, and even some non-energy firms on the global top 500 list are setting sights on China's PV power market.
2018 was a year of transformation and adjustment for China's PV power industry, whose new installation capacities plunged following unveiling of the 531 new policy, which suspended new common ground-mounted PV power station projects, restrain the scale of distributed PV power capacities, and slash subsidies. In line with its policy cutting subsidies, the Chinese government publicized a notice pushing no-subsidy PV power projects in Jan., which will ward off speculation-oriented PV power investors.
Lu Bin, a specialist in M&A in China's energy industry at PwC China, noted that with the restraint on new PV power projects, medium- and large-sized Chinese PV power enterprises will resort to acquisition and merger to augment their scale, while smaller ones may accept their offers, due to adverse business environment, leading to market consolidation.
The paper points out that in the long run, green energy, especially PV power, will be the focus in the adjustment of China's energy structure, for which the government will roll out supportive policies step by step, including reform of the power sale system, green certificate mechanism, and green-energy quota, which will revitalize and sustain the PV power market. Meanwhile, technological progress and improvement of grid network will drive further development of the PV power industry in the long term.
(First photo courtesy of Steve Rainwater via Flickr CC BY-SA 2.0)