[LINK] Chinese solar and now wind-turbine industries pledge co-operation

[Stephen Loosley]

(Probably best one resource solar/wind soonish then?)


"China’s wind-turbine makers vow ‘self-discipline’ in pledge to end price war"

Twelve leaders in the sector follow solar equipment makers in an agreement to end their damaging campaign of undercutting

By Yujie Xue Published: 4:30pm, 17 Oct 2024 https://www.scmp.com/business/climate-and-energy/article/3282739/chinas-wind-turbine-makers-vow-self-discipline-pledge-end-price-war


As new entrants eye China solar sector, overcapacity and price war concerns mount

China’s major wind-turbine manufacturers pledged to end the industry’s prolonged price war, following a similar announcement by the country’s solar-panel industry a few days earlier.

Twelve leading players – including Goldwind, Envision, Mingyang Smart Energy, Shanghai Electric and Dongfeng Electric – signed the promise at a conference in Beijing on Wednesday, agreeing to improve self-discipline in setting prices and avoid price collusion.

Undercutting in the wind-energy industry is hurting manufacturers’ earnings and hindering the sector’s sustainable development, forcing most companies to take losses, said Qin Haiyan, the head of the China Wind Turbine Association.

“Wind power is an advanced productive force, and wind turbines require a long usage cycle and represent high-value investment,” said Lou Yimin, Envision Energy’s senior vice-president and president of the wind-turbine division. “We must look to the long term and focus on the return on investment over a full life cycle of 25 to 30 years.”

He said he hoped the industry would return to a path of healthy development and rationality through the joint pledge.

The announcement came after the 780-member China Photovoltaic Industry Association hosted a meeting in Shanghai on Monday, during which companies including Longi Green Energy, Tongwei and JinkoSolar reached a consensus to prevent “vicious” competition.

China led the world in wind and solar capacity growth last year, adding 76 gigawatts (GW) of wind capacity, 66 per cent of the world’s total, and more than 60 per cent of the world’s 425GW of solar photovoltaic (PV) capacity, the International Energy Agency (IEA) said in a report on Wednesday.

Beijing has called for the country to peak carbon emissions by 2030 and have non-fossil fuel sources account for 80 per cent of the total energy mix by 2060 – the year China aims to achieve net-zero emissions. Companies have rushed to enter the renewable-power business to ride the tide of this government push.

Rapid expansion of manufacturing has slashed the cost of PV modules by 50 per cent since December 2022, according to IEA.

With fierce competition and technological advancements, the price of Chinese wind turbines dropped by more than 30 per cent last year, according to Wood Mackenzie.

With losses mounting, Zhu Gongshan, the founder and chairman of GCL Technology, one of China’s largest solar material makers, called in June for government intervention and industry discipline to help correct the “severe mismatch” between supply and demand.

It is unclear when the agreements will take effect. However, the pledges potentially put a floor under the market price for wind turbines and solar panels, according to David Fishman, a manager at power sector consultancy The Lantau Group.

“Obviously the price wars are very painful for all the players,” he said. “Many of them could be operating at a loss and burning through cash because the alternative is losing market share to your competitors who are doing the same thing.

“It was a war of attrition. You’d hope that this action would help to raise the market price and restore profitability to those that were below the profit margin.”

Shares in Danish company Vestas Wind Systems, the world’s largest wind-turbine manufacturer, surged 2.7 per cent on the Nasdaq Copenhagen exchange on Wednesday after the announcement.

Shares of Shanghai-listed Mingyang dropped by 1.7 per cent to close at 10 yuan on Thursday, while Hong Kong-listed Goldwind rose 0.3 per cent to HK$5.90.



Yujie is a business reporter for the Post with a focus on energy transition, climate change and sustainability issues. She previously worked as a technology reporter in
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