Tuesday, April 7, 2020
Solar Power Market Likely to Shrink
Declining Solar Demand
Solar Power Market Likely to Shrink
  • By Jung Min-hee
  • November 22, 2016, 01:45
Share articles

The US and China are reducing the supply of solar energy.
The US and China are reducing the supply of solar energy.

 

According to industry sources, China recently decided to build solar power generation facilities with a combined capacity of 110 GW to 130 GW by 2020, instead of 150 GW as previously planned. This has to do with the underutilization of existing solar power plants. With China accounting for 30% of the global solar power demand, its decision is likely to have a negative impact on market conditions.

The U.S. solar power market is likely to lose steam as well because President-elect Donald Trump has a negative view on climate change response and has promised to increase the use of fossil fuels and cut renewable energy subsidies. The United States represents 15% to 20% of the global solar power demand.

A potential contraction of the solar power market is predicted to affect South Korean polysilicon manufacturers. For example, OCI and Hanwha Chemical are likely to witness a decline in profitability.

According to experts in the industry, the total capacity of solar power generation facilities around the world is expected to increase by 64 GW next year, 11% less than in 2016. In the meantime, the global polysilicon production volume amounted to 480,000 tons in the first half of this year, 80,000 tons more than the global total demand. China is looking to increase polysilicon production in China to import less, which means a supply glut is likely to follow. Recently, the price of polysilicon fell below US$15 per kilogram.