The country accounts for 80% of the world’s solar panel production.
Chinese companies are producing so many solar panels that they have caused a market glut — and, as a result, prices are falling. Financial Times reports in Germany and the Netherlands, the panels are already being used for garden fences; the practice is also gradually spreading in the UK, North America and Australia.
Typically, solar panels are installed on roofs where they can capture as much sunlight as possible, but their low price allows them to be installed elsewhere, while saving on hiring specialists for high-altitude work.
«Why build a fence when you can just put up a bunch of solar panels, even if they are not exactly oriented to the sun?», — says Martin Breaux, Head of Climate Research at BNP Paribas Exane.
The global supply of solar panels is projected to reach 1,100 gigawatts by the end of 2024, which, according to the International Energy Agency, is three times higher than demand.
Prices for solar panels have already halved last year and, according to the agency, will potentially drop by another 40% by 2028.
The oversupply from China also makes it impossible for US and European producers to compete effectively — and this will be one of the topics that US Treasury Secretary Janet Yellen will address during her visit to the Asian country.
«During her meetings in China, Secretary Yellen will defend the right of American workers and businesses to be treated fairly, including by pressuring Chinese counterparts on unfair trade practices and emphasizing the global economic impact of China’s overcapacity», — the Treasury Department said in a statement.
Last week, Yellen said during a visit to Suniva’s solar panel manufacturing plant in Georgia that she was «concerned about the global overcapacity in China» that has hit new energy industries — including solar panels, electric vehicles, and lithium-ion batteries.
Chinese manufacturers are also facing problems from an oversupply of solar panels. Last month, Longi Green Energy Technology, the world’s largest solar panel manufacturer, announced that it was laying off thousands of workers.
«I will express my belief that overcapacity poses a risk not only to American workers and companies and to the global economy, but also to the productivity and growth of the Chinese economy», — Yellen said.