China Snaps Up California Solar Market
Jan 14, 2010 - Todd Woody - The New York Times
China’s rise as a major solar module maker has been meteoric, but perhaps nowhere has its ascension been faster than in California, the United States’ largest solar market.
Over the last three years, China’s share of the California market, in terms of supplied megawatts, has risen to 46 percent, from 2 percent, according to a preliminary report by Bloomberg New Energy Finance, a research and consulting firm.
At the same time, the share supplied in California by American companies has declined to 16 percent, from 43 percent.
“The ascendancy of Chinese manufacturers would be noteworthy regardless of market conditions, but is particularly telling in a time when purse-strings are still tight,” the report said.
At the beginning of 2009, Chinese solar companies supplied 21 percent of the market; by year’s end their stake had more than doubled.
This is not necessarily a zero-sum game, however. The California solar market has continued to rapidly expand through the recession, growing by a third last year. The state accounts for 40 percent of the American solar market.
Solar module prices have also fallen precipitously in the past year, a period that has coincided with China’s push into the California market. Those companies’ lower manufacturing costs gave them an edge over competitors, according to Bloomberg New Energy Finance.
A Chinese module maker with little name recognition in the United States, Yingli, has captured 27 percent of the California market thanks to low pricing, the report said. Suntech, China’s leading module-maker, has a 10 percent share in California.
“The main factor behind Yingli’s dominance is a spate of commercial rooftop project applications,” Nathaniel Bullard, a solar analyst with Bloomberg New Energy Finance, wrote in an e-mail message.
The report noted that the solar module market was volatile and that “this quarter’s league leader could well be next year’s also-ran.”
With Chinese companies subject to the vagaries of United States-China trade relations, both Suntech and Yingli have moved in recent months to locate manufacturing plants in the Southwest, close to the California market.