subsidy
January 11, 2012
China's solar market growth has hit the rocket phase in late 2011 with the announcement of the long awaited national Feed in Tariff . Many of the Chinese utilties have set up large solar farms utilizing the cheap solar panels produced by Chinese solar panel companies. Note Chinese solar companies are the dominant players in the world having almost killed the western solar industry in the last couple of years. With cheap costs and massive government support, China is almost ruling the solar industry globally . In the domestic Chinese market they have even a bigger advantage given the local home conditions and preference of domestic companies . Note China become home to the biggest wind turbine companies when China enacted the domestic content requirements in 2006. With the solar industry , the Chinese government does not need this law as its companies already possess massive advantages over the foreign competition.
January 11, 2012
Green Industry in US continues to flourish despite the general apathy towards global warming from a significant section of the population and parties. USA is the hotbed of green innovation despite stiff challenge by China which is spending billions of dollars to become the No.1 in Green Industry and Technology. US has the lead in Fuel Cell Technology with a number of top companies like Fuel Cell Energy, Bloom Energy. Now a start up ClearEdge Power has got one of the biggest fuel cell orders in the world worth $85 million from Austria's Gussing Renewable Energy. The deal calls for supplying of 50 megawatts of power by the year 2020.
January 11, 2012
Europe which has been one of the greenest regions on earth in terms of promoting green energy and reducing carbon emissions is set to face a severe test. Europe is going to impose a Carbon Tax on Airlines flying into the region from 2012 . This has got the other major countries seeing red, with most of them planning retaliation. This Green Tax will add around $3 billion per year in terms of extra fees from airlines or around $6 per extra passenger. While airlines from USA and Canada approached the court, airlines from India and China are refusing to pay the tax outright. Indian airlines won't supply their carbon data while China won't pay the taxes . Note European Union is isolated in this fight against climate change . Though Carbon Trading is not a perfect system and open to abuses, at least it makes a pretense to fight global warming. On the other hand,these other countries have no plan or intention to fight climate change.
January 11, 2012
Europe has got the largest installed capacity of wind and solar energy due to the proactive policies enacted by the governments there.However the renewable energy industries have not been left unaffected by the European debt crisis. Offshore Wind Energy is a European development with most of the major offshore wind power farms located in Germany and UK. France which is tendering for 5 GW of offshore wind energy farms has seen reduced bank interest according to Areva. Offshore Wind Energy grew by more than 50% in 2010 and is expected to continue at above 50% growth rates over the next several years as the global installed offshore wind capacity multiples by more than 25 times over the next 10 years.
January 10, 2012
The Indian Desert State of Rajasthan in the West which borders Pakistan is planning to set up four gigawatt scale solar parks in 4 districts of Jodhpur, Jaisalmer, Bikaner and Barmer. Note under the first 2 phase of JNNSM , Rajasthan has got the lion's share of the solar farms being constructed. The reasons why Rajasthan has managed to corner 80% of the JNSSM solar projects is because
a) Solar Radiation is the highest in the country
b) Land is cheap and plentiful in the state with the government literally given them for free to solar developers. A huge plus in a country where land acquisition is a big industrial problem
c) Support from the government
January 10, 2012
The massive solar panel glut has not only caused Western solar companies to go bankrupt but has also caused mayhem in the Chinese solar panel industry.Many of the smaller companies have seen their utilization go down to 35% or lower with many of the others shutting down their production entirely.There are hundreds of small solar companies in China which started during the 2010 boom when global solar demand increased by more than 150% . However their small scale of operatoins and lack of brand power means that they are bearing the brunt. While the large Chinese solar panel producers have seen their utilization go down , most will survive given the support from Chinese Banks. For example LDK despite its more than $3 billion in debt and losses is still getting loans from Chinese Development Bank. But the smaller Chines OEM panel makers don't have the government sugar daddy behind them.
January 10, 2012
Mahdindra Solar One a JV between India's biggest conglomerates the Mahindra Group and a PE backed startup Kiran Energy is setting itself to become one of the biggest players in India's Solar Energy.Mahindra Group which has dominant Indian companies in the Automobile Industry,Information Technology has set up 3 subsidiares to operate in the following segments
January 9, 2012
Solar Trade Wars are becoming the norm in the globe these days with the major one between USA and China.The instigator is the German solar company Solarworld which helped started the ITC Case in the USA.India too is thinking of putting some kind of import duty to protect its domestic solar panel producers which are dropping like flies.Chinese solar panel producers have swamped the world with super cheap solar modules.Though a part of their low prices can be explained by competitive advantage, another part is due to the labor,capital subsidy given by the Chinese government.It would not take a rocket scientist to say that some of the biggest Chinese solar companies are insolvent and would be dead within a month without Chinese state loans.
January 9, 2012
Saving bankrupt solar companies has become the national pasttime of most governments it seems.Competition in the solar market has become so severe that solar comapnies are failing left and right.This has made the government come out to save them with bailouts which only make the oversupply situation in the solar panel industry worse.While China is the worst culprit supporting hundreds of failing solar companies through cheap loans which will be never paid back,other governments are not far behind.
January 9, 2012
Solar Renewable Energy Certificate (SREC) Prices in New Jersey have been falling at a sharp rate from a high of $600 to $225 as high returns from falling solar panel prices and other tax breaks.This has led to a massive growth in solar installations in the state making it the 2nd largest state by solar capacity.New Jersey installations have crossed 500 MW and made it a huge green job driver in the state.However this boom has made the market driven SREC prices fall quite sharply.Though not falling as sharply as Pennsylvania where SREC prices have become a joke ,they are still low and falling.
January 9, 2012
Solar Power in India is growing by leaps and bounds with the federal and state governments heavily promoting solar energy production.India is set to become a gigawatt market in 2012 with around 400 MW already installed by 2011.The ancillary industries around the main solar power market are set to grow at a rapid clip as well.One of the unlikely sectors in solar products in India is the growth of solar cables.Note solar power plants require a lot of wire and cabling to connect thousands of solar panels to each other and to solar inverters.Besides solar power plants also require interconnection with the power grid.While today most of the solar cable is imported from outside,there is potential for a solar cable manufacturer to build a domestic capacity as well given the rapid growth expected in solar power.
January 9, 2012
However distribution into the millions of villages remains the biggest hurdle even if the people there can afford the products.T here are no good roads and the smaller solar companies lack the marketing muscle of say a big MNC like Hindustan Lever and ITC.People have tried to sell solar products using the microfinance companies but have not had much success as of now.India's government has also pushed some small subsidy schemes but the red tape and the off and on nature has meant failure.
January 9, 2012
Coal Stealing and Pilferage by the Coal Mafia has always been done on a massive multi million dollar scale. In the coal rich states of Jharkhand, Bihar, West Bengal and Chattisgarh, Stealing of Coal is a major illegal industry. Everyone knows about it and nothing is done as most officials and politicians get a cut of the illegal gains. Corruption in India is institutionalized as governing bodies remain weak and powerless. Despite India's much touted growth story,all these needling problems have contributed towards the Indian GDP slowing down sharply. Unless governance is improved,its tough to see how India can achieve its potential.
January 9, 2012
Note one of the main dangers of nuclear energy is the probability of the fuel getting into the hands of terrorists and rogue nations which can use it to make nuclear weapons.Note the fears of a Taliban like group getting their hands on nuclear arms in Pakistan is all too real.With Iran getting nuclear weapons,this will increase.Nuclear Power is already being phased out in Germany,Japan,Switzerland after the Fukushima nuclear disaster.The dangers of nuclear energy are too great to make it an option to secure mankind's energy in the future.Despite the advantages of nuclear power,the risks are too great to be played with.
January 9, 2012
Indian Solar Panel Companies are asking for protection from cheap imports from China and other countries.Note the prices of solar panels have fallen by 60% in 2011 due to a number of reasons such as cheap raw material polysilicon prices,high competition between major module manufacturers,dropping processing costs.The biggest reason for the solar panel price crash has been the support of the Chinese and other Asian government to their respective domestic solar industries.
January 7, 2012
Japan which has faced two of the worst nuclear accidents in history,the atomic bombing in WW2 and the Fukushima disaster,is thinking of nationalization of the nuclear industry.This comes after the fallout of the Fukushima,where the utility TEPCO needed a massive bailout.To pay compensation and repair the disaster would have bankrupted TEPCO and still left a massive hole.The Japanese government had to step in with a big money package so that TEPCO could meet its liabilities.Note the biggest disadvantage of nuclear power is the catastrophic tail risk of a nulcear meltdown.
January 7, 2012
Wind Turbines are generally considered safe and reliable though there have been cases of Blade Cracks and Falling.However the recent cases of Wind Turbine Explosions and 15 feet blades flying off have generally been not seen before.With 112 mph winds,the extreme stress cases of wind turbines were tested in UK recently.The gale like conditions led to some of these wind turbines failing.While a couple of wind turbines burst into fire some of them saw their 15 ft blades flying off.This is not to say that wind energy is dangerous,just that extreme nature conditions can lead to accidents for solar panels and wind turbines as well.
January 7, 2012
The German Solar Energy Market is biggest in the world and has installed the largest number of solar panels for the last few years.2012 promises to be no different with Germany again set to the biggest solar market for solar panel manufacturers though Italy would give good competition.The German Solar Subsidy program has been the best in the world unlike the start and stop feed in tariff programs of Spain,Czech,UK,Australia and other places.A stable step in cut of feed in tariffs has helped solar energy prices coming down by more than 50% in the last few years though demand has only increased.
January 6, 2012
Note the Indian solar projects are growing continuously and with the possible additoin of 1000 mw of solar energy in 2012 we will see much larger solar installations with 100 MW solar farms being planned.Besides solar thermal power plants are bigger in size in general.While the growth of big solar installations is good, India really needs to move to rooftop small solar installations and off grid solar promotion.
January 6, 2012
US Solar Projects including the 1000 MW Blythe Solar Project is now available for solar developers,installers at fire sale prices.The Insolvency Administrator is looking to sell parts and the whole of the solar project business of Solar Millennium and its US subsidiary Solar Trust of America.Note before filing of bankruptcy,the solar project developer had around 2000 MW of solar projects in the pipeline.
January 6, 2012
LDK Solar is one of the most insolvent companies in the world right now with billions of dollars in debt,a battered balance sheet,continuing losses and dodgy accounting.However LDK has acquired a German company Sunways and continues to build new solar power plants as the Chinese state owned banks continue to fund it with cheap money without any consideration about losing their investments.LDK has become the poster boy of the Solarworld complaint against Chinese solar panel producers as it continues to run and thrive despite being insolvent.The Chinese government is hurting itself and its other solar companies like Trina,Yingle which are more competitive by continuing to support and increase the global glut of cheap solar panels.These solar panels are being clearly sold at below cost as most of the companies would be bankrupt without these absurd loans which make no free market sense
January 5, 2012
Chinese Wind Turbine Companies have unleashed a global price war in which Western producers are unable to compete.While Solar Panel producers in the West are dying like flies,Western WTG Makers too face survival questions.Vestas which is the world's biggest turbine company in terms of installations announced another revenue shortfall for the nth time in the last couple of years.The company has already restructed ,reduce workforce etc etc.However the price competition from the Asian companies is too severe and too sustained for Vestas to surive too long.Like First Solar,Vestas seems a likely candidate for takeover by one of the big industrial conglomerates.It has become too tough for a renewable energy company in the West to survive on their own.
January 5, 2012
Biomass Plants in India are shutting down as feedstock costs have increased rapidly while government regulated electricity tariffs have yet to increase.60% of India's Biomass Plants have closed down as they are longer profitable.Note India has a massive growth target for biomass electricity capacity up from 1 GW at present (2 GW if you count cogeneration).A number of agricultural companies have set up a number of plants besides dedicated green utilities.However inflation in India has affected the operation of plants specially those who don't have inhouse feedstock supply.
January 5, 2012
China has announced a new solar subsidy for BIPV systems of 9 Yuan per Watt ($1.4/watt) and CNY 7/watt for PV systems for home.Note China has already become a top 5 market in the world in 2011 after announcing a $1.15/kwh Feed in Tariff for utility scale solar power instalations.This new subsidy by the Chinese ministry of finance should boost the home and commercial segment.Note China had recently raised the target of solar energy to 15 GW by 2015 from 10 GW as solar energy has grown amazingly fast in the recent past.
January 5, 2012
Pakistan is a energy deficit country like most other South Asian countries with inadequate investment in the electricity sector and the distribution infrastructure.The cause of the energy crisis in the country is due to massive corruption and misgovernance , a theme which will be familiar to citizens of India as well.Pakistan has been looking at investments from the Chinese power companies in the hydro and wind sectors to boost electricity generation.However these investments take time and some may never come to fruition.However Pakistanis are now turning towards cheap Chinese solar panels to beat the high electricity tariffs and dependence on expensive diesel generators and UPS systems.
January 4, 2012
South Korean Conglomerates LG,Samsung,Hyundai and Hanwha have made massive investments in solar energy production in the last couple of years.Encoraged by the Korean government to become a force in the Green Energy area in the future,Korean giant chaebols have invested in almost all areas of cleantech like Electric Vehicles,Wind Energy,Solar Energy,Energy Storage etc.While Western companies fall like flies in the face of the Chinese onslaught of super low pricing,Koreans are holding their own and want to take fight into the Chinese camp.
January 4, 2012
JNNSM Phase 2 recieved almsot 8 times the bids with 2500 MW worth of bids out of which around 350 MW was selected for providing Feed in Tarifffs with the average tariff of Rs 8.77 or 17.5c/Kwh .Note India's execution record has not been great with only 400 MW solar capacity reached in 2011 against a target of more than 1000 MW.However weaker and unknown players have gone out of this business and the winners this time look more likely to construct these solar power plants.No doubt a massive glut of solar panels in the world with prices as low as 80-90c/watt helping .Compare that to prices of solar panels which were more than $2/watt last time.
January 4, 2012
Smaller Polysilicon producers with small sizes and higher costs are going bust almost everyday.With poly prices falling below $30/kg even bigger producers with inefficient plants like MEMC have been forced to curtain capacity.The smaller poly producers with 2000-3000 tons capacity have virtually no future.With poly expansion still taking place by big producers even in an oversupplied market the small fish are having the capitulate.
January 3, 2012
Chinese Solar Panel Producers have become a famous target of an anti dumping petition brought on by Solarworld and other companies.Though US Solar Installers have opposed the move as it will increase the solar panel prices in US,ITC has gone ahead with the investigation.Though the charges of subsidies and efficiency can be debated,the fact remains that US Solar Panel Producers can't compete with Chinese Solar Panles.Massive industrial overcapacity in China has made the prices of products very cheap and made it difficult for Western producers to compete in most areas such as Chemical,Renewable Energy,Textiles etc.The Chinese win because of their low interest rates,cheap labor,free land,massive government support.
January 3, 2012
Airline Ticket Prices are set to go up as European Union implements its ETS Scheme on the Airline Industry from 2012.Note EU as a region has been one of the most active players in the climate change arena and has an active carbon emissions market.Though this market has encouraged fraud and profiteering by unscrupolous players making it a good target for the fossil fuel lobby,the principle to fight against global warming is a good one.Compare that to USA,Canada and Japan who have done nothing to fight climate change despite the wealth of these nations.Canada has been guilty of abandoning the Kyoto Plan after missing its previous target.It has faced no penalties as it is not legally enforceable.The country continues down the pollute as much as you can pushing oil extraction from tar sands which is much more dangerous to the environment than normal oil drilling.