China Sees Solar Consolidation Accelerating Amid Adjustments

China’s government said it expects consolidation to accelerate among solar companies, which are struggling to cope with a shift in market conditions.

Companies with the strongest technology, capital, management and brands are best equipped to benefit from market opportunities, the Ministry of Industry and Information Technology said in a statement on Wednesday. The agency expects steady growth in China’s solar industry in the second half.

The fight for survival in the photovoltaic sector has been intensifying. The government has worked to eliminate outdated production capacity by encouraging solar manufacturers to consolidate through mergers and acquisitions or restructuring.

China’s production output of polysilicon, the raw material to make solar cells, increased almost 16 percent in the first half to 74,000 metric tons, according to the statement.

The nation imported about 60,000 tons of polysilicon in the period. China produced 19.6 gigawatts of solar panels, up 26 percent from the previous year, the ministry said.

Outside the country, Chinese solar manufacturers are building or expanding 3.2 gigawatts of solar cell capacity and 3.3 gigawatts of panel capacity, the ministry said. They currently have a combined overseas capacity to make 800 megawatts of solar cells and 1.5 gigawatts of panels annually.

— With assistance by Feifei Shen

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