China instals 25% of Global Solar Energy

China missed its 12 GW solar installation target for 2014, as it only managed to install 2 GW of distributed solar capacity for 10.6 GW of overall solar energy capacity. While large scale solar farms met their target of 8 GW, distributed solar energy could not catch up. China now has set a target of 15 GW of solar energy capacity in 2015, with 7 GW of distributed solar energy. This might be difficult, given that it is extremely hard to scale up small energy installations compared to large ground mounted installations. It also requires much more effort from distribution utilities, regulators, grid operators as well as higher costs.

However despite falling short, China accounted for 25% of the world’s solar capacity addition of around 40 GW in 2014. China is also the major producer of the world’s solar panels, with 35 GW of solar panels and 38 GW of solar wafers being produced. China accounts for more than 50% of the companies in the top 10 solar component producers. Production also increased dramatically for poly production with 57% increase. This is one area where China is deficient and the current trend shows that it is making up fast. NEA figures shows that the cumulative solar capacity in China is now 28 GW, which makes it second to Germany. Given the current trend of China installing more than 10 GW and Germany at around 2 GW, you would expect that China should overtake Germany as the largest producer of solar electricity in 2015. China is already the largest producer of wind power, with its current run rate of more than 15 GW a year extending its lead further and further.

Read more about China Solar Power here.

China has become a global heavyweight in solar energy both from the demand and supply side. Thanks to the massive support given by the Chinese government, major solar producers in China have become cost and size leaders. While China may not be a technology leader, it may become a leading technology player. Its large sized companies spend more and more to gain a cost edge over competitors. With most of the process and scale advantages in solar production having being exploited, technology is the major frontier for further cost reductions.