All the optimism that China would in fact “catch up” in the second half of 2019 after its appalling start to solar installations this year, have turned out to be rubbish. China’s National Energy Administration has put out numbers this week that Q3 delivered just 4.6 GW of solar capacity across the country. Last year there was a total of well over 42 GW, and the half year figure leading up to this in the summer was around 11.5 GW, making this a year to date figure for 2019 of 16 GW.
It would need to install a further 22 GW to reach even 40 GW for the year in Q4, and it looks like that is just not going to happen. 20 GW is a more likely outcome for China now for 2019, smaller than every year since 2014.
China is such a huge part of the global market for solar, with its 2018 installation rate about 5 times the next highest country (which was the US) that a miss this large could set back solar providers for the year as well, and slow price reductions – often associated with scale, in the near future.
That 4.6 GW was installed after new subsidy rules were brought in after Q2, which were held off in the first half, in order to get some capacity contracted on an unsubsidized basis. But it looks like suppliers just adjusted to sending panels elsewhere, and have not yet looked back at China. We know that neighbors like Vietnam and other warmer countries like Spain, have absorbed many of the panels which were destined for China this year, although there is still likely to be a global shipment shortfall come end of year.
China’s total cumulative installations are now thought to be around 191 GW, still the world’s largest installed capacity.
The split was given as 7.7 GW for utility-scale solar plant, and 8.3 GW for distributed solar installations. The NEA did say it had approved a ton of capacity in the summer, around 22 GW based on new feed-in tariffs, but it clearly just did not get installed.
Most sources quote Asia Europe Clean Energy Advisory (AECEA), which had begun the year forecasting 35 GW to 40GW and it has now lowered its expectations to between 20 GW and 24 GW making Chinese solar down around 50% for the year.
AECEA which operates close to the Chinese market talked about late decisions for new policies and a new national unified bidding system, as well as continuously falling module prices, and a FiT price that was too low.
The idea had been to shift to from 100% subsidies in 2018 to entirely subsidy free by 2021, and the process has not been well managed, but AECEA suggests that the authorities may make more announcements to “fix” the situation somewhat before year end.