China is expected to install a record amount of solar power in 2021 as the industry continues to benefit from green policies in the country, which already has the world’s largest fleet of panels.
What is Happening?
- According to the China Photovoltaic Industry’s Association, solar installations in China should reach 55-65 GW in 2021, up from 48.2 GW in 2020 and surpassing the record set in 2017. Globally, capacity is set to rise by 15-170 GW this year. BloombergNEF analysis shows that solar is already economically attractive today in most major markets due to policy support and cost declines, and it forecasts 2021 global installations at between 151 GW and 194 GW.
- The association says that most solar farms should this year be able to provide electricity as cheaply as the average grid supply as investment costs decline.
- Chinese production of polysilicon, wafers, cells and modules all increased by more than 10% last year, however its solar exports declined.
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- This push for solar energy comes amid a concerted environmental effort in China, which has pledged to hit peak emissions by 2030 and achieve net-zero emissions by 2060.
- Shares of solar companies have surged since the 2060 goal was announced in September, with polysilicon maker GCL-Poly Energy Holdings Ltd. up nearly 1 000% in Hong Kong.
- Meanwhile, the National Energy Administration said that China added almost 72 GW of wind power in 2020, more than double the previous record. The country also added about 13 GW of hydropower.
- Analysts with UK-based HSBC Bank wrote in a report that increased solar generation capacity will further drive down the cost of solar power, by as much as 50% from current levels by 2025.
- The country has not yet publicly released details of how it will achieve the 2060 goal, however analysts have said China could set a high carbon price in the carbon trading market, which could incentivise carbon-emitters to reduce coal-fired power generation.