Fact or Fiction – Shungfeng claims that it will install 10 GW of Solar Capacity by 2015
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The Chinese company Shungfeng has been shortlisted for buying over the solar manufacturing assets of Suntech. Shungfeng is listed 
on the HK stock exchange and was a minor renewable energy player till it made a bid for Suntech. Note Suntech used to be the largest module supplier in the world till 2009, before the solar industry downturn led to its downfall. The massive debt burden on the company made it unable to sustain during the industry downturn and it defaulted on its bond payments in early 2013. The $2 billion debt meant that the company had almost no way of recovering, given the large losses it was making. Zhengrong Shi who was considered as the father of the Chinese solar industry was ousted and a new management team was put in place. The web of different holding entities has meant that the bankruptcy and subsequent selling of assets has been quite messy. It has been the first big bankruptcy in China in recent times as the quasi capitalist state does not allow for bankruptcies.
Read more about the Chinese Solar Industry.
Shungfeng is now claiming that it will install 10 GW of solar power plants by 2015 which seems a bit of overreach to me. Note China does have an ambitious target of installing 35 GW by 2015 but Shungfeng alone installing 30% seems a bit over the top for me. There are other more aggressive companies in China such as the big 4 utilities as well pure play solar players such as Goldpoly, GCL, Hareon and others who are pursuing large solar power projects in China. The US listed companies such as Trina, Yingli and others have also become very active in the solar development area.
Shungfeng is being backed by real estate tycoon Cheng Kin which gives the company some solid financial power in terms of buying Suntech and putting in equity for the solar power projects. However, installing 3 GW of solar power will take some doing given the lengthy processes of approvals, clearances, getting transmission capacity etc. Shungfeng is already claiming that it has around 1 GW of solar power plants.
Shunfeng chairman Zhang Yi said the company aimed to build 3 gigawatts of solar farms this year. It has 0.89GW of installed solar capacity connected to the power grid.He estimated that it would cost between 24 billion yuan (HK$30.7 billion) and 27 billion yuan to add 9GW over the next three years.Zhang said he expected the projects to generate an annual rate of return of 10 to 15 per cent.
Source – South China Morning Post