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China’s developing solar energy empire

with Beijing heavily supporting its industry, the Chinese companies are forging ahead..Instead of subsidizing the purchase and use of solar power, China has focused on building the competitiveness of the country’s manufacturers. As a result, China exports 95 percent of the solar panels it produces.

China benefits as U.S. solar industry withers, NYT 1 Sept 11, HONG KONG — The bankruptcies of three American solar power companies in the last month, including Solyndra of California on Wednesday, have left China’s industry with a dominant sales position — almost three-fifths of the world’s production capacity — and rapidly declining costs.

Some American, Japanese and European solar companies still have a technological edge over Chinese rivals, but seldom a cost advantage, according to industry analysts.

Loans at very low rates from state-owned banks in Beijing, cheap or free land from local and provincial governments across China, huge economies of scale and other cost advantages have transformed China from a minor player in the solar power industry just a few years ago into the main producer of an increasingly competitive source of electricity……

Analysts say that two American companies remain strongly placed. One is First Solar, the largest American manufacturer, which uses a different technology but has its biggest factory in Malaysia. The other, SunPower, is much smaller but is an industry leader in the efficiency with which its panels convert sunlight into electricity, so that they sell at a premium to Chinese panels.

But with Beijing heavily supporting its industry, the Chinese companies are forging ahead…….

Shares in large and small Chinese solar power companies have mostly rallied in the last two weeks on the New York and Hong Kong stock markets, as investors have welcomed their strong quarterly results and the prospect of dwindling competition from Western rivals……Instead of subsidizing the purchase and use of solar power, China has focused on building the competitiveness of the country’s manufacturers. As a result, China exports 95 percent of the solar panels it produces.

U.S. Solar Company Bankruptcies a Boon for China – NYTimes.com

September 2, 2011 - Posted by Christina Macpherson | business and costs, China