It is said that in order to put an end to the disorderly unhealthy competition in the solar energy module industry and protect enterprise's profit, the National Photovoltaic Industry Union is brewing. In the recent two years, the domestic solar energy industry has been expanding at a extremely high speed. A great deal social capital wells up in the solar energy industry. As a result, the national solar energy module can not be expanded rapidly. Spontaneously the unhealthy competition of haggling over prices between enterprises starts to appear.

Production can be expanded rapidly

    The demand for technical content in the entire solar energy industry is not very high, so it is relatively easy to enter the solar energy industry. In the recent 12 years, in order to share the the magnificent prospect of solar energy industry, most domestic enterprises choose the form of module enterprise to start their solar energy undertaking. As a result a lot of module enterprises are springing up like mushroom.

    Zhang Shuai, the researcher in National financial instrument, believed that, it was relatively easy to enter the solar energy industry. Similar to electron semiconductor enterprises in the coastal region,  unhealthy competition is inevitable after output increase.

    In order to take the preemptive opportunities in this competition, the solar energy module enterprises have been expanding production of energy in abundance to reduce the producing cost. "As a matter of fact,it is a race, the one who can make a mass production and lower the cost can over the current difficulty." A module enterprise's principal said.

    The downward trend of the price of solar cell module is also obvious. In 2005 the price for one tile of module was 35 US dollars -38 US dollar, but the price started to drop from the beginning of this year. Now the price is about 32 US dollars. It is estimated the price possibly will be reduced to 30 US dollars at the end of this year.

The price conduction is unable to realize

    A module enterprise's principal told to reporter that, " The National Photovoltaic Industry Union is not only helpful to control the price competition, but also advantageous to the solidarity of the industry. Therefor, the price conduction can be realized smoothly.

    At present what bothers the module enterprises most is that although module price tend to drop, the purchasing price of solar cell still stay the same.

In fact, the solar cell production enterprises also confront the same problem that the raw material price stays at a high level, and the price conduction is unable to be smoothly realized. Under such condiction, Zhong Dian Nan Guang starts to expand production in abundance.

    The industry introduced that, polycrystalline silicon is mainly monopolizes by several big merchants in Japan and USA. The main part of profit is taken by polycrystalline silicon manufacturers. Today, the supply falls behind the demand in the polycrystalline silicon market, so it's not realistic to expect the polycrystalline silicon price to drop

    Because the price is unable smoothly to conduct, the profit ratio of domestic module enterprise still stay very low, at present the module production enterprise's gross profit rate is only about 10%.

    Academia Sinica experts believed that, 2008 will be a bad year for most module enterprises.  In  2009 because of the price conduction, the price of polycrystalline silicon may drop. In 2010, as the domestic polycrystalline silicon projects come on stream gradually, the home production can achieve 60,000 -100,000tons; the international production also will expand to about 100,000 tons at that time. However, in 2010 the world polycrystalline silicon demand will be only about 100,000 tons. At the appointed time, the polycrystalline silicon price will probably go down so that the entire industrial price conduction will also be realized smoothly.

    Origin: China Stock