African PV: Pie or trap?

REVIEW: The industry is going through a long winter of PV companies seem to find a new continent, the African PV market grew 8 times 5 is expected to attract the attention of Chinese enterprises at the same time, "too hard" sound also sounded the same time.

Is the pie still a trap? Can the African market become a new growth point for Chinese companies? There is no unified answer in the industry.

8 times the future?

The United States, Europe, and India... The news of China's PV products is constantly catching up. The large-scale development of emerging markets has become the inevitable result of the winter. As a worldwide choice, Africa has become a possible choice for the rescue industry.

"We will sort out the global PV market. By 2016, the total installed capacity of PV in the world will exceed 50GW," said IMS analyst Xie Feng. "The markets in the Middle East and Africa are indeed on the rise, from 1.6GW in 2009 to 2012. 4. 9GW of the year."

Globally, more than one billion people still live in an environment without electricity, 80% of which is in sub-Saharan Africa. In line with Africa's abundant solar, wind, geothermal energy and other resources, African countries are also vigorously promoting the development of new energy, but because of the low starting point, the overall progress is slow.

Chinese PV companies have entered the African market and theoretically have unique advantages. Due to the unique sunshine conditions, the huge gap in the power market, and the large area suitable for the construction of photovoltaic power plants, Africa has incalculable solar power resources. At the same time, China's PV industry as a whole is in a leading position in the world. Compared with European and American companies, China's products are cheap and good, have a price advantage, coupled with rich experience in production and installation, laying the foundation for entering the African solar market.

"Africa's solar coverage is very good, such as South Africa, Morocco and Egypt, which have very good sunshine resources. African countries have cheap labor resources and land resources, which are very good competitive advantages." Peak believes.

Solar photovoltaic power generation depends not only on the photoelectric conversion efficiency of photovoltaic cells, the provision of various tracking systems, but also on the latitude and sunlight quality of the local area, while the solar energy resources in Africa are relatively abundant. The potential picture of solar photovoltaic power generation in Africa shows that in the same photovoltaic array, Africa produces twice as much electricity as Central Europe.

IMS Research predicts that the African market will show a rapid growth trend in the future. The capacity will increase from 160MW in 2012 to 1.4GW in 2017. It will expand 8 times in 5 years, which is a performance for Chinese companies to replicate the performance of European and American markets. It is possible.

While Chinese PV companies are optimistic about the African market, African countries have also extended their olive branches to Chinese companies.

On October 30th, the Ugandan government delegation came to China to introduce Chinese companies' confidence in the field of photovoltaics and became an important issue.

Uganda’s special assistant to the President’s Office, Kabaviza, said that Uganda has considerable preferential policies for the photovoltaic industry, such as import and export tax exemption, and the government can also help enterprises provide land. At the same time, it is becoming a national strategy to create conditions for PV products to enter Africa and encourage enterprises to go out to sea. "The next step in the South-South cooperation project between China and Africa will include PV products in the scope of assistance to Africa." Huang Wenhang, director of the Climate Change Division of the National Development and Reform Commission, said on November 22.

Cautious choice

The African market looks broad and everything is possible, but it is hard to know.

In 2011, China's PV products exports reached US$35.8 billion, of which the European market accounted for 57% of the market. In contrast, the African market is less than 1%.

Taking the 2010 Yingli Group sponsorship of the World Cup in South Africa as an opportunity, Chinese-made photovoltaic products began to enter Africa's vision and gradually established a good reputation, but it has been expanding.

As early as the days when China's PV industry was in full swing, it was suggested that Chinese PV companies should not put their eggs in the same basket and move to emerging markets such as South America, Southeast Asia and Africa.

Compared with mature markets in Europe and America, emerging markets such as Africa have their own characteristics. Europe and the United States are mature markets, and their business environment and trading environment are controllable. But for mature markets, all the rules are fixed and can only be moved within their scope, and these markets are not unreservedly welcome to Chinese PV products.

There are no such obstacles in the African market. The low market threshold, huge demand, abundant human resources, no local related enterprises, and no anti-dumping problems are the unique advantages of Africa.

But for most Chinese companies, Africa is still a word associated with the negative impressions of poverty, backwardness and famine.

"Yingli has tried in Africa, and the effect is not satisfactory, because the security problems, economic problems, and policies there are unclear." Yingli Group Propaganda Department introduced.

In fact, until now, the biggest project for Chinese companies in Africa is a 50 MW power generation project in Kenya. Most of the other projects are small and small. "More are testing the market and there are no projects."

"Africa has many advantages, but the uncertainty is too great. Such a market is not suitable for the development of large-scale investment, and is more suitable for short-term and fast projects of small and medium-sized enterprises."

Cautious is not only Yingli himself, but Trina Solar is equally cautious about entering the African market. On November 28th, Trina Solar was able to donate solar modules to three community service centers in Malawi, Africa, to improve local medical conditions and to focus on Africa.

Trina Solar's cooperation with Innovation Africa began in May 2011, and TRW provided photovoltaic modules for solar system installation at the Visezi Clinic in Bagamoyo, Tanzania.

The Visezi Clinic provides medical services to 2,770 people in the local community. Before the solar power system was installed last year, the clinic was unable to provide normal medical assistance at night due to lack of electricity. If you encounter maternal night production, you can only rely on kerosene lighting, it is almost difficult for doctors to see their patients.

According to reports, the solar modules donated by TRW will be used in conjunction with a power storage system to provide illumination for the above three facilities at night and with low visibility.

"Tianhe Solar can not make any big investment in the African market now." Fan Lifeng, director of TRW's public relations, told the new financial reporter, "We are doing public welfare projects."

"The African market is facing opportunities and challenges. If the photovoltaic industry is developed, it needs more resources, infrastructure is relatively weak, and financing capacity is lacking." Xie Feng said, "These need to be solved."

The only exception came from Suntech. At the 2012 South Africa Energy Show, Suntech signed an investment of more than $350 million to build a 100 MW photovoltaic power generation project.