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CEEG forced to cancel their Solar expansion as money is exhausted

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Cheap money and over-investment has led to a catastrophic overcapacity in the solar panel industry leading to solar panel prices falling by more than 80% in the last 2-3 years, while hundreds of companies have gone bankrupt. The net margins of most companies remain negative and the industry has seen billions of dollars in losses in the last few years. China’s local government has provided generous loans to local small solar companies which have built hundreds of factories. With no money and sales, many of these companies have shut down.

Solar equipment providers in US and Europe have benefited tremendously from the solar expansion in 2010 and 2011, as companies went crazy in expanding their capacity. But with most companies having no money for working capital, solar equipment sector has seen their orders go down by 80% in the last year. Many of them have also shut down, while others are teetering on the brink of bankruptcy. Read about Bad times in Solar Equipment industry.

Chinese Companies distressed

Centrotherm which is one of the biggest German solar equipment providers has now seen the cancellation of a huge 290 million Euro factory from CEEG Solar (China Electric Equipment Group Corporation is based in Nanjing, China and is a China state owned company). This Chinese company like others is in a distressed state and hardly in a position to make a payment for 29 million euros, leave alone 290 million euros in Africa. Centrotherm has faced huge problems in the last one year and has already gone to the bankruptcy court once. I don’t think solar cell or module expansion is going to happen in a major way in the next couple of years though the solar equipment sector has probably seen a bottom now.

Centrotherm which was the second largest seller of solar equipment with revenues of more than $800 million faced credit crunch. The company’s bank refused to renew credit lines or give it shipment finance. Hyundai had earlier bought solar cell equipment from Centrotherm as far back as 2008. Also Read why solar equipment sales fell off a cliff, only $3.6 billion sold in 2012 compared to $13 billion last year.

Companies will have to improve the efficiency of solar cells to compete and reduce costs. They will need to invest in new equipment to gain an edge over competitors. While GT Advanced Technologies (GTAT) has already stopped wafer making and ingot making operations, it is waiting for the cycle to turn before investing in HiCZ technology which will improve wafer efficiency and cost. Investing in top solar equipment companies like GTAT and AEIS may not be a bad idea at this point of time.

PV Tech

CEEG cancels €290 million PV factory order with Centrotherm photovoltaics

Having successfully exited insolvency proceedings, Centrotherm photovoltaics has been hit by the cancellation of a long-standing order by CEEG to build a €290 million PV module assembly plant in Algeria. Centrotherm photovoltaics did not say why CEEG, a subsidiary of Société Nationale de l’Electricité et du Gaz (Sonelgaz) had cancelled the contract but said it was examining any impact the cancelled deal would have on the company. A consortium consisting of Centrotherm photovoltaics and Kinetics Germany won the contract to build the plant. The company said that the order cancellation would have no negative effect on its planned cash flow and that any damage compensation claims would be covered by the existing insolvency plan.


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

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