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Australia exploits below cost Chinese Solar Panels while USA imposes Duties

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China as a Boon for Australia

Australia has seen its economy boom over the last 10 years, thanks to the voracious appetite for commodities from China. The growth in the minerals and mining sector has led to sharp GDP growth in the country which also managed to escape the global financial crisis in 2008. China has proven to be a boon for Australians as it has also become a source of cheap electronic and mass manufactured goods.

Australia has seen a big increase in solar panel installations due to generous subsidies given by individual states in Australia, like New South Wales and others. Unlike other parts of the world where solar installations have started with large solar farms; residential rooftop installations have powered Solar Energy in Australia. According to the Australian Clean Energy Regulator more than 800,000 Australian homes have installed solar energy with the overall capacity from solar energy now at 2 GW. Despite falling subsidies from the Government, the crash in solar system prices in Australia has meant that the growth is not going to stop any time soon. The reason for the sharply lower solar panel prices (now 70c/watt wholesale price in China from $4/watt in 2008) is the massive capacity expansion and cost reduction by Chinese solar panel companies.

The prices have dropped to such a low level that solar manufacturers in Europe and USA have become bankrupt. The USA has in fact imposed duties on imports of Chinese solar equipment (which seems a bit misguided). They should probably learn from Australia which is taking advantage of cheap Chinese panels to boost its energy capacity. The target of a million homes will be met soon as free electricity from solar panels means that more and more Australians install solar. The utilities have been the biggest losers of this solar boom in Australia as their sales have collapsed and they have been forced to retrench workers.

Planning to buy a solar power system, read our reviews on Australian Solar Inverters and Australian Solar Panels.

However the growing penetration of solar energy means that the power grid will have to be upgraded to meet the intermittent supply of power from solar panels in the day. However that is a small price to pay for cheap and clean energy.

Australian Utilities in Trouble

The country has literally seen a doubling of solar panels systems for homes from 400,000 households to 800,000 households. This has become a huge headache for solar utilities who have seen their revenues fall precipitously as customers start to use much less electricity from the power grid. A number of homes are also selling their excess power into the grid which makes the utilities lose even more money. The boom has been particularly intense in the state of Queensland where an expiry of a solar feed in tariff led to a huge pull in demand. Over 100,000 applications were filled and it is estimated that around 15% of the population now has a solar rooftop installation in place. Solar Power poses a huge headache to power utilities which have always had fixed amount of demand and revenues. This can now be seen in reality in Queensland where Stanwell Corporation, is believed to be seeking up to 100 redundancies. This is being done as the market has become oversupplied with power in a short time, with a big jump in distributed solar power generation by homes. This has led to a sharp reduction in demand of power being supplied by Stanwell and other utilities in the state. I have predicted that Indian power utilities too should be ready for such a situation in the future as high electricity tariffs are forcing customers to turn towards in-house solar power generation.

PG

Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to greensneha@yahoo.in or call me on +913340606492.

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