China Moving To Distributed Solar Over Utility-Scale

by Giles Parkinson.

China solar installation
China currently has around 2GW of distributed solar PV, according to Bloomberg data, but wants to increase this ten-fold to 20GW by the end of 2015.

Originally published on RenewEconomy

China is looking to switch the emphasis of its booming domestic solar market towards the “distributed” market – essentially rooftop and small, local, plants – rather than large, utility-scale solar farms.

China, for several years the largest exporter of solar modules, is widely expected to emerge as the world’s largest consumer of solar modules in 2014. The official target stands at 12GW, although some private forecasters such as Deutsche Bank think this could rise as high as 15GW.

Most major solar manufacturers expect China – along with Japan and the US – to account for most of their growth in coming years. But what’s got them a little worried is a draft proposal that will require two thirds of this growth to be from distributed systems.

The solar companies make higher margins, and bigger profits, from large scale installations, but it seems that the Chinese administration is worried about the potential transmissions issues and costs.

According to a Credit Suisse analyst report quoted in Barron’s, the solar market is also concerned that the central government’s focus on distributed generation, at the potential expense of utility scale projects, may make the ~12 GW target unrealistic if utility scale projects are capped at 4 GW.

“The emphasis on the distributed generation segment may make utility scale project approvals from the central government less obtainable,” the report said. And it noted there were concerns about how quickly the rooftop market could grow, given ambiguity about rooftop ownership, and the fact that new feed in tariffs for distribution generation do not commence until the new year.

However, another report from Nomura Securities says it would  make more economics sense for the government to install distributed systems instead of utility scale projects.

“The policy makes economic sense as retail/commercial tariffs are high in the eastern provinces and thus the policy’s focus on distributed installations will generate higher economic returns. In addition, lack of land availability will constrain utility scale projects.”

But that may disappoint some of the major manufacturers, who had big plans for utility-scale projects. These include GoldPoly (which had a pipeline of 1~3GW of large scale projects), Shunfeng (3GW), Hareon Solar (1~3GW), GCL (1GW), Jinko Solar (~300MW), JA Solar (~300MW), Trina Solar (500~800MW), and Yingli Solar (500~800MW). It is thought at 6-7GW of projects are already in development. Some Chinese solar stocks have taken a hit on the stock market in recent days as a result.

China currently has around 2GW of distributed solar PV, according to Bloomberg data, but wants to increase this ten-fold to 20GW by the end of 2015. That would require around 8GW to be installed in 2014, and another 10GW the following year.

Most of the installations are targeted for the major population and industrial centres around Shanghai, Guangzhou and Beijing.

This article, China Looking Towards Distributed Solar Over Utility-Scale, is syndicated from Clean Technica and is posted here with permission.

About the Author

Giles ParkinsonGiles Parkinson is the founding editor of, an Australian-based website that provides news and analysis on cleantech, carbon, and climate issues. Giles is based in Sydney and is watching the (slow, but quickening) transformation of Australia’s energy grid with great interest.

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