Hobbled U.S. Solar Sector Puts China in Dominant Global Position

2

The bankruptcies of three major U.S. solar companies in recent weeks have propelled China into a dominant position in the global market for solar panel production, with the Chinese now commanding nearly three-fifths of the world’s production capacity.

While many U.S., Japanese, and European solar companies maintain technological advantages in the increasingly important renewable energy sector, analysts say a combination of low-interest loans, inexpensive land, and massive economies of scale has given China a huge cost advantage.

Earlier this week, California-based Solyndra Inc. announced that it was suspending operations and filing for bankruptcy protection because it was unable to compete with larger competitors.

Two other U.S. companies, Evergreen Solar and SpectraWatt, also filed for bankruptcy protection in August. The three companies represented about one-fifth of the U.S.’s solar panel manufacturing capacity.

Meanwhile, China’s three biggest solar power companies recently announced sales increases of 33 to 63 percent from a year ago. With increased manufacturing capacity worldwide and disappointing demand, prices of solar panels have dropped more than 40 percent in the last year.

Article appearing courtesy Yale Environment 360.

About Author

Yale Environment 360 is an online magazine offering opinion, analysis, reporting and debate on global environmental issues. We feature original articles by scientists, journalists, environmentalists, academics, policy makers, and business people, as well as multimedia content and a daily digest of major environmental news. Yale Environment 360 is published by the Yale School of Forestry & Environmental Studies and Yale University. We are funded in part by the Gordon and Betty Moore Foundation and by the John D. and Catherine T. MacArthur Foundation. The opinions and views expressed in Yale Environment 360 are those of the authors and not of the Yale School of Forestry & Environmental Studies or of Yale University.

2 Comments

  1. Good for China, at least they have common sence and are able to see the big picture, they will profit by saving oil to produce electricity, plus be able to profit by supplying the world with their reasonably priced panels.

    I feel America should learn from them, here they only think how much they should charge for their products so they could generate a big bonus for their worthless CEO, that’s why we are here just waiting for the best deal.

  2. Alas, the US lost the ability to compete in mass manufacturing of commodified products long ago, so this news should be of no surprise either. US manufacturers have to seek out and find specialized niches where our technical advantages can be telling in order to survive. There is no way we can compete with Asia in mass production of anything anymore.

Join the Conversation