China's solar glass shortage to drag on panel output into 2021

Xinyi Solar Holdings

03/12/2020 09:04

* Solar glass prices have doubled in six months
    * Installation rush late this year worsened shortfall
    * China makes nearly 80% of world's solar panels, industry
says

    By Emily Chow
    SHANGHAI, Dec 3 (Reuters) - A shortage of solar glass which
is already crimping China's solar panel output is expected to
persist through the first half of 2021, with large format glass
in short supply for longer, panel makers and analysts say.
    Driven by growing preference for bifacial modules - which
produce power from both sides of the panel - and larger panels,
demand is outpacing production capacity addition, they say. An
installation rush in the last quarter of the year has worsened
the shortfall.
    "There is a call for glass manufacturers to get production
capacity up, but you still need about two years to fully come
online," said Leon Chuang, global marketing director at solar
module maker Risen Energy  300118.SZ .
    Solar glass spot prices are nearly double the May-June 22-26
yuan ($3.35-$3.96) range per square metre, said Chuang.
    "In the short term we cannot do anything. We just accept the
high price of the solar glass... Now the shortage has eased but
it's because module makers have tweaked capacities, delayed
sales and reduced revenues."
    China is the world's biggest manufacturer of photovoltaic
products, with almost 80% of the world's solar panel production
capacity in 2019, according to the China Photovoltaic Industry
Association (CPIA).    
    Heavily dependent on coal for power generation, the country
hopes to reduce coal usage by increasing renewable energy
sources including solar, wind and hydro to meet its climate
pledges.
    Its solar sector was barely hit by the coronavirus outbreak
and is expected to see newly installed solar power capacity
reach 35-45 gigawatts this year, the CPIA said in July.
 urn:newsml:reuters.com:*:nL3N2ET0OO
    Glass production is expected to increase next year as new
capacity from glass makers Xinyi Solar  0968.HK  and Flat Glass
 601865.SS  comes online, said Amy Fang, an analyst at renewable
energy research firm InfoLink Consulting, but large panel
supplies will run short throughout 2021. 
    "The new capacities can produce larger glass modules... But
large format glass capacity will be unable to catch up with
module capacity next year," she said.  
    "As module demand shifts to large format glass from the
second half of next year, the shortage is expected to worsen
then. Prices for such glass may remain at high levels."
($1 = 6.5595 Chinese yuan renminbi)
    

 (Reporting by Emily Chow; editing by Philippa Fletcher)
 ((emily.chow@thomsonreuters.com; +862120830020; Reuters
Messaging: emily.chow.thomsonreuters.com@reuters.net))