Trina Solar readies for impact as China move tipped to slash PV prices
China's abrupt removal of solar subsidies could trigger falls of as much as a third in panel prices, and prompt a global shake-up that companies such as Trina Solar are preparing to ride out.
Data released overnight by Bloomberg New Energy Finance show global spending on solar energy 19 per cent in the first half of 2018 to $US71.6 billion ($96 billion). Wind energy investment rose a third to $US57.2 billion.
China, which installed a record 53 gigawatts of new solar capacity in 2017 may add just 37 GW this year. Surplus output could lop a third off module prices to 24.4 US cents per watt by year's end, Bloomberg NEF says.
Trina Solar, one of China's three biggest photovoltaic producers, said the removal subsidies last month will take a toll on so-called "tier-2 producers" that had failed to develop markets abroad.
"Without an international market, they will be under pressure," Yin Rongfang, president of global sales at Trina, told Fairfax Media.
Trina estimates its share of the Australian market - its third-largest in the Asia-Pacific behind China and India - at about a third. Sales in Australia are likely to be 400-500 MW this year.
As modules become commoditised, Trina will offer customers additional services, such as bundling with storage, energy efficiency and management, and pre-assembly of power plants that businesses are increasingly after, Mr Yin said.
A mark of the company's evolution is its total workforce of about 15,000 has remained stable over the past decade even as capacity has risen more than 40-fold from 200 MW to almost 9 gigawatts last year.
Trina sales totalled 36 billion yuan ($A7.3 billion) last year, with profits of about 650 million yuan. After delisting from the New York Stock Exchange in March 2017, the company is now in the process of re-listing in Shanghai or Shenzhen, Mr Yin said.
The cut in China's tariffs could see a "reversal for the first time" in solar PV, Justin Wu, Bloomberg NEF's Asia-Pacific chief, said. "That will lead to discounts, and a lot of severe competition."
Still, any drop will likely be eased by surging demand in other nations, such as India, where falling module prices will spur the market.
"This is more a speed-bump [for the industry] than a major turning-point," Mr Wu.