Foreigners see bright prospects in solar energy market

The Chinese government's determination to fight air pollution and the nation's developing solar energy market have attracted more international players to compete for a slice of the cake.

"I just feel it is the right timing," said Bruce Yung, managing director and vice-president of business development of First Solar, China.

The US-based world leading solar module manufacturer and PV solution provider said it is "on track for final approval" in the second quarter for its 2 gW project in Ordos in the Inner Mongolia autonomous region, and plans to start construction in the third quarter.

China announced plans to raise its solar-power installation target for 2015 to 35 gW from the earlier 21 gW at the end of January, as smog constantly haunted the nation's cities.

Meanwhile, the country's top economic planning body issued a draft in March to set four rates, from 0.75 yuan (12 US cents) to 1 yuan per kWh as feed-in tariff for solar-power plants that sell electricity to grid operators, in a bid to encourage the grid integration of solar power.

"First Solar's strategic focus is to become a premier partner of choice in support of the Chinese government's pursuit of clean solar energy," he added.

Meanwhile, it is "in talks" with several local governments on similar projects, and is also "seriously looking into China" as a base for manufacturing, said Yung.

First Solar has a large manufacturing unit in Malaysia, but it is possible that it may commence manufacturing in China if there is sufficient demand in the nation for the company's products, he explained.

The feed-in tariff policy and government plans are driving explosive growth in photovoltaic power generation. Solar is likely to develop in the same way as wind power, in which a 10 to 15 percent market share is taken by foreign players, Yung said.

Meanwhile, California-based low-cost solar module manufacturer Solaria Corporation said on Monday that it is planning to open a high-volume manufacturing facility in China, PV-Tech reported.

Solaria said it is working on several megawatt-size projects in Qinghai province and Inner Mongolia.

Different from its counterparts from the United States, China-based Canadian Solar, a Nasdaq listed solar manufacturer and total solution provider, is taking a more cautious attitude.

"Sure, China has entered the top 10 largest markets for solar devices. It has got loads of potential. But Canadian Solar is still taking a strategy which puts the overseas market higher on the list for expansion," said Shawn Qu, CEO of Canadian Solar.

Qu said the company is focusing on medium- and long-term development in the China market, by establishing a presence in areas that may have opportunities and talking to local governments about solar plants projects, rather than expanding aggressively.

"The key point is to implement the feed-in tariff policy, which will help to ease pressure on cash-strapped solar industry players," he said.

The company raised its guidance for first-quarter shipments and margins last week, and expects the margin to reach 9 to 10 percent in the first quarter.

"The margin for the first quarter in 2013 is higher than the average of last year, thanks to our rational operation, which stresses market selection rather than sales numbers," he said.