Oct. 16, 2002
Secrets Behind the Solar Industry Prosperity in China
On Sept. 24, Prof. Zhang Qichu of Sydney University, Australia, popularly named as "King of Coating" among international solar community, was officially granted the Chief Honorary Scientist title by the Himin Solar Energy Group (www.himin.com), Shandong province, China. At the same time, the new generation " Triple High 180" solar water heater with Zhang's coating technology goes onto market. Thus a new era comes when China's top solar products company and world's top solar scientists join the hands to push the chinese solar industry one step forward.
Solar industry is a new industry in China. Along with shortage of supply of conventional energies, and demand on an environment friendly and sustainable development, utilization of solar energy is being more and more emphasized. Growth of the solar industry is also quite remarkable. Until end 2002, total installed solar water heater areas amounted to 26 millions m2, replacing an equivalent of 4 millions tons of standard coal a year. China is the no 1 producer and consumer of solar water heaters of the world. China's yearly production of solar water heaters is twice that of Europe and 4 times that of North America. Total revenue of this sector amounted to RMB 6 billions last year and the industry is still growing at 20-30 % p.a.
What's the reasons behind the rapid development of China's solar water heater industry and why are the Western counterparts lag behind even with an annual R&D of US 8 billions budget ? Prof. Zhang, well-known for his vacuum tube gradual shaping membrane and triple-target interference membrane patented technologies,has conducted careful studies on that phenomenon. According to his researches, first, the developed countries are indeed paying much attention to energy and environment protection issues and they have superior technological positions too over China (in the solar energy sector too). However, the R&D results need to be commercialized by the industry sectors and the industries in turn have to consider the economical benefits when introducing a new technology. In the West, electricity and fuel are relatively cheap, therefore solar products are not much welcome. Expensive labor cost also hinder the development of the industry.
What surprises Prof. Zhang and his colleagues is the huge market space already created in China: sales networks are even penetrated into towns at the county level,millions of people are benefiting from the solar products. When the Himin CEO was introducing the solar products development in China on the 2000 United Nations' Renewable Energy Conference, it was a shock to the participants from all around the world. Some experts said they are willing to grant free use of their researches. According to these experts, it is China where there's the hope for solar industry.
Industry insiders think, however, although the domestic solar industry is developing very fast, there're obviously problems with it. For example, the top 10 producers out of the 3000+ solar products manufacturers take only 17 % of the market portion. Under this circumstance, price battle is easy to be triggered and some simple assembly lines may also find it easy to pirate other products. Therefore, it's vital to raise the technical entrance barriers and to replace the low quality products with high quality, high performance ones.
As investigated and predicted by the China Hardware Products Association and China Information Center, currently the purchase ratios of the three main household heaters - gas fired heaters, electricity heaters and solar heaters - are 57.4 %, 31.3 % and 7.6 % resp. Duo to relatively high prices of gas and electricity, these ratios will be adjusted to 35.8%,30.2% and 23.2% resp. within next three years. From there it's easy to find a huge market potential. Sources also say the State Economic and Trade Commission considers the solar energy industry as one of the main new energy sectors to be supported by the state policies and other measures. It's planned to raise the application ratio of solar water heaters in households from present 7.6% to 25% within next 15 years. Industry standards are being worked out to support the large-scale enterprises to develop their brands. Factories with old technologies and low quality will be superseded. A fierce survival battle is advent.
