China Renewable Energy Industry Report: May 9

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May 9 – This is a regular series of relevant industry news from around China.

Renewable energy
•Chinese Huadian Power International Corp will reportedly develop over 1 gigawatt of wind power installations in Shandong Province, with its plans also including an offshore wind power project.

Shanghai Securities News reported last month that the company would seek the green light to build an offshore wind farm in the province, one of China’s regions that offer the best wind resource. Huadian has already built 450 megawatts of wind power systems in Shandong.

China added 18.9 gigawatts of fresh wind power capacity in 2010, accounting for almost half of the 38.3 gigawatts that were installed globally.

“China has become the single largest driver for global wind power development. In 2010, every second wind turbine that was added anywhere in the world was installed in China,” Steve Sawyer, the Global Wind Energy Council’s (GWEC) secretary general, said earlier in April. The wind market in the Asian country doubled each year between 2005 and 2009, while in 2010 the total installed capacity arrived at 44.7 gigawatts.

•U.S. photovoltaic equipment provider GT Solar International Inc on April 25 said it had won a US$93.9-million supply order in Taiwan.

The contract, awarded by polysilicon producer Powertec Energy Corp, envisages the delivery of a complete suite of polysilicon production equipment and technology including SDR 400 reactors, hydrochlorination, filament and product processing equipment.

The equipment will be installed in Powertec’s new polysilicon plant, which is expected to start operation in 2012. The SDR 400 CVD reactor has an output capacity of 400 tons of polysilicon a year, the company said.

•Hydro Tasmania and Hong Kong-based electricity producer CLP Holdings in April announced they were to end their wind farm development joint venture Roaring 40s and to divide the assets.

Via the move, the two companies seek to continue their wind power development activities separately. The deal, which is pending regulatory clearance, will be formally closed and the assets will be transferred at the end of June.

As part of the agreement, Hydro Tasmania will become owner of the entity’s wind power plants in Studland Bay and Bluff Point in the northwestern part of Tasmania. The company will also get a share in the Musselroe project in northeastern Tasmania.

CLP, on the other hand, will acquire a working wind farm at Waterloo in South Australia and the joint venture’s interest in the Cathedral Rocks wind power facility. CLP will acquire a share of other mainland projects.

Roaring 40s was formed in 2005 to develop green energy projects in Australia and abroad, especially in China. Part of the unit’s employees will now get new positions, but the former partners said there will be lay-offs.

•Chinese wind turbine maker Xinjiang Goldwind Science & Technology said on April 25 it had secured orders for five 1.5-megawatt wind turbines from U.S. customers. The company did not provide any details on the clients or the price.

The direct-drive permanent magnetic wind turbines will be installed at two wind power plants in Ohio and Rhode Island.

According to Goldwind, securing orders in overseas markets is becoming an important part of the business agenda of China’s major wind turbine makers. Exports are rather low compared with the sector’s rapid development for the past few years. Goldwind said that in 2010 China exported 13 turbines with a combined capacity of 15.55 megawatts.

Up to now Goldwind, touted as the biggest direct-drive permanent magnetic wind turbine manufacturer around the globe, has some 3,500 units installed and grid connected.

•Chinese power producer Datang International Power Generation said on April 26 its attributable net profit jumped to US$13.4 million in the first quarter of 2011 from US$2.38 million in the same period last year.

The firm attributed the increase of net profit to the growth of installed capacity and on-grid electricity.

Operating revenue rose by 6.37 percent to US$2.39 billion. Total power generation improved 24.73 percent to 46.0327 billion kWh.

•Chinese photovoltaics maker ReneSola Ltd’s net profit more than tripled to US$43.3 million in the first quarter of 2011, from US$11.8 million in the same period of the previous year.

Operating profit surged 256.6 percent on the year to US$75.6 million. Revenue increased 58.9 percent to US$328.2 million, meeting the company’s expectations.

Solar product shipments rose 36.3 percent to 330.4 megawatts, exceeding the outlook. Wafer shipments increased 7.3 percent to 243.5 megawatts and module shipments surged to 86.9 megawatts from 15.4 megawatts for the year-ago period.

ReneSola’s CEO Xianshou Li said the company faced a drop in module average selling prices but wafer pricing was strong and cost-cutting initiatives enabled it to achieve gross margin of 30.7 percent.

For the second quarter ReneSola guides for solar product shipments of 330 – 350 megawatts, revenue of US$280 million to US$300 million and gross profit margin of 25 percent to 27 percent.

The company also plans to spend US$350 million this year to boost wafer production capacity from 1.3 gigawatts to 1.9 gigawatts, module production capacity from 400 megawatts to 600 megawatts, and polysilicon production capacity from 3,500 tons to 8,500 tons.

•China may spend over US$1.54 trillion in the next 15 years on renewable energy projects, Shanghai Securities News writes, citing an unnamed official from the National Climate Change Expert Committee.

Undoubtedly the renewable energy leader in Asia, China announced in 2009 that it was planning to reduce by 40 percent to 45 percent carbon dioxide emissions per unit of its gross domestic product from 2005 till 2020. By the end of the decade, it seeks to fetch 15 percent of its power from renewable power sources.

•U.S. photovoltaic equipment provider GT Solar International Inc won a US$218.9 million supply order for advanced sapphire crystallization furnaces in China.

The contract was awarded by Guizhou Haotian Optoelectronics Technology Co Ltd (HTOT), which enters the light emitting diode (LED) market, GT Solar said on April 27.

HTOT board chairman Hao Xu said the company would use the ordered equipment in its new plant for manufacturing of products for the LED industry.

•Chinese photovoltaic equipment major JA Solar said on April 28 that U.S. bank Wells Fargo will support its growth in the U.S. market and globally under a recently struck strategic cooperation agreement.

As part of the deal, Wells Fargo will provide commercial banking services to JA Solar, financing for the Chinese company’s marketing and project development activities in the United States and other support. The two parties did not provide any financial details on the agreement.

The cooperation deal is in line with Wells Fargo’s strategy to expand its reach within the renewable energy sector. The bank has already spent US$500 million on solar projects. Since it entered the industry in 2006, Wells Fargo has deployed over US$2.7 billion in project capital for more than 250 renewable energy projects across the United States, or more than 4,200 megawatts of green capacity.

•China Energy Recovery, or CER, on April 28 said it had won a US$5.1 million contract to design, supply and install a waste heat recovery system at a new sulfuric acid plant in China’s Hubei Province.

The order has been placed by chemicals producer Hubei Yihua Fertilizer Co Ltd. The system is due to be completed in the second quarter of 2012. CER said the contract brought the total value of its heat recovery system orders for delivery by end-2012 to US$150 million.

•Chinese solar equipment maker JinkoSolar said it had agreed to deliver 50 megawatts of solar modules to Bull PowerTech GmbH, part of German photovoltaic technology firm Bull Holding AG.

Under the contract, JinkoSolar will supply modules under a co-branded label with Bull PowerTech this year.

JinkoSolar said the agreement was in line with its strategy to expand in Europe and globally.

•Chinese Huadian Power International Corp reported a first-quarter net loss of US$40.8 million against a net profit of US$11.85 million a year earlier, hit by increased coal prices.

The company, which operates thermal electric, hydropower and wind power plants in China, booked operating revenues of US$2 billion, up 29.5 percent year-on-year.

At the end of March Huadian Power had bills receivable of US$56.47 million, while long-term payables amounted to US$281 million.

•Chinese photovoltaic product maker Trina Solar has partnered with Australian National University (ANU) for research and development on the production of high-efficiency solar cells, Trina said on April 28.

A three-year R&D agreement has been signed between Trina Solar’s unit Changzhou Trina Solar Energy Co and ANU.

Following the agreement, Trina Solar and ANU will cooperate to develop n-type monocrystalline solar cells with 20 percent conversion efficiency for commercial production by utilizing existing processing tools used for p-type cells production. The partners will also aim to increase the efficiency of Trina Solar’s standard p-type multicrystalline silicon cells to 19 percent.

The R&D partnership is expected to receive some US$3.3 million in funding from the Australian Solar Institute, which is part of the government’s Clean Energy Initiative that supports innovative research ideas.

•Chinese large-size boiler maker Hangzhou Boiler Group will buy a 20 percent interest in Zhenjiang Supcon Solar Energy Technology for US$7.7 million, news source stcn.com reported citing a company filing.

The company will acquire 21 million shares in the solar power firm. After the deal, Supcon’s registered capital will be increased to uS$16.11 million.

Earlier this week, Hangzhou Boiler posted a net profit of US$10.4 million for the first quarter of 2011, down 23.01 percent on the year. Revenue grew 10.61 percent to US$117.08 million.

•Russian hydropower group RusHydro said on April 29 it would develop hydropower, wind and other renewable energy projects together with State Grid Corporation of China under a recently signed strategic cooperation agreement.

The two companies will form a working group to coordinate their joint activities.

State Grid Corporation of China, touted as the biggest utility on the globe, constructs and operates electricity transmission and distribution lines. The company is present at 26 provinces, autonomous regions and cities in China, covering 88 percent of the country’s territory.

•Wind power developer Hecic New-Energy Co Ltd, a unit of China Suntien Green Energy, saw its net profit for the first quarter of 2011 grow to US$24.5 million from US$9.48 million the year before.

Operating profit rose to US$23.05 million from US$10.59 million, the company’s parent said. Revenue for the period nearly doubled to US$41.1 million from US$21 million.

•Chinese solar panels maker Suntech Power Holdings Co Ltd said on May 3 it has agreed to provide 100 megawatts of solar panels in the next two years for U.S. SunBorne Energy’s projects in India.

The framework agreement involves Suntech’s 280-Wp polycrystalline silicon modules. It includes a 10-megawatt initial order for a project in the state of Gujarat.

India’s solar sector has been developing rapidly thanks to solid government subsidies combined with the country’s ample solar resources. The country seeks to reach 2 gigawatts of off-grid and 20 gigawatts of on-grid photovoltaic capacity by 2022 in order to meet growing domestic energy demand.

•Danish wind-turbine maker Vestas Wind Systems said on May 3 it will supply, install and commission 50 units of its V90-2.0 megawatt wind turbines in the Chinese Shandong Province.

The name of the customer and the value of the deal were not disclosed. The contract also includes a VestasOnline Business SCADA system. Delivery will take place from the second to the third quarters of 2011.

•German solar energy systems maker Centrosolar Group AG announced on May 3 it has commissioned its first anti-reflective coating line in Huzhou, China.

The production line has an annual capacity of 1.8 million cubic meters (63.6 million cubic feet) of glass. It is located at a partner company that operates a glass melting furnace in Huzhou on behalf of a Centrosolar subsidiary.

Anti-reflective glass is used as a covering for crystalline photovoltaic modules and can increase their power yield by up to 6 percent. Centrosolar currently produces anti-reflective glass in Germany and exports it to various markets, including the United States and the Far East. By starting production in Asia, the company will be able to better tap the demand on this continent and reduce shipping costs.

•Chinese construction firm Shenyang Power Group (SPG) Co has signed a letter of intent with China Machinery Engineering Corp (CMEC) for the construction of a 615-megawatt wind power project in Texas.

Under the agreement, SPG will award an engineering, procurement and construction contract for the Texas Wind Farm to engineering contractor CMEC, said Chinese A-Power Energy Generation Systems, which owns 19.5 percent of SPG.

As part of the deal, CMEC will also assist SPG in securing US$260 million in debt from banks and other agencies in China for the project, and also provide equipment from suppliers selected by SPG.

The parties expect to close the agreements needed for the binding contract in May.

The Texas wind project is owned, developed and will be operated by Spinning Star Energy, a joint venture between SPG and United States Renewable Energy Group Partners I. A-Power sold 42.5 percent of its 62 percent-stake in SPG in October last year.

•Danish wind-turbine maker Vestas Wind Systems A/S said on May 4 it signed a 49-megawatt contract to supply V80 turbines and a frame agreement for another 250 megawatts with Chinese Inner Mongolia Guibang Shengtai Investment Co Ltd.

The turbines will be installed at a site in Huitengxile in the Chinese Inner Mongolia Autonomous Region. They are due for delivery in the third quarter of 2011.

Vestas will supply the turbines and supervise their installation and commissioning. It will as well provide a VestasOnline Business SCADA solution and maintenance.

•China Suntien Green Energy announced on May 5 it had registered its 150-megawatt Weichang Yudaokou Muchang wind farm with the clean development mechanism (CDM) of the Kyoto protocol.

The company estimates that the registration will bring around US$4.6 million in additional annual revenues in 2011 and 2012.

To date, China Suntien has registered eight projects with the CDM executive board.

•Solar cell maker China Sunergy said on May 5 its photovoltaic solar modules had received certification under the UK’s microgeneration certification scheme (MCS).

The company’s CEO, Stephen Cai, said the MCS certificate enables the company to enter the UK market.

The certificate issued by the certification body British Board for Telecommunications is valid by April 24, 2014.

It authorizes products to be sold with the MCS approved product mark and enables projects built with Sunergy modules to qualify for UK solar feed-in tariffs.

•Spanish wind energy company Gamesa signed an agreement to supply 300 megawatts to China Resources New Energy Group (CRP-Renewable), part of China Resources Power.

Gamesa will deliver 150 of the G90-2.0 megawatt turbines to CRP-Renewable in the second half of 2011 to six wind farms in the Chinese provinces of Heilongjiang, Shanxi and Guangdong, Gamesa said on May 5.

In April, Gamesa signed memoranda of understanding to supply 900 megawatt wind turbines to Chinese firms Datang Renewable Power, China Longyuan Electric Power Group and China Resources Power. The current contract formalizes the MoU with China Resources Power.

CRP-Renewable takes part in 42 wind farms of a total capacity of 646 megawatts. The company is building other 631 megawatts and has permits for other 970 megawatts.

Gamesa has installed around 3,000 turbines in China since 2000, having a joint project portfolio of 2,900 megawatts. China accounted for 28 percent of Gamesa’s total sales at end-2010. The Spanish firm has four manufacturing sites in the country and is building further two.

This industry report brief is courtesy of AII Data Processing.

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