How China Came to Dominate the World in Solar Energy
Several of China''s biggest solar panel manufacturers are building final assembly plants in the United States to tap subsidies offered as part of the Inflation Reduction Act.
From 2018 through 2022, solar parts were the dominant export earner among China's clean energy suite, but since then a drop-off in solar sales as key markets hit saturation point has meant that batteries are now in the top spot.
China unleashed the full might of its solar energy industry last year. It installed more solar panels than the United States has in its history. It cut the wholesale price of panels it sells by nearly half. And its exports of fully assembled solar panels climbed 38 percent while its exports of key components almost doubled.
Chinese manufacturers are competing for customers by cutting prices far below their costs, and still keep building more factories. The price slashing has taken a severe toll on China's solar companies. Stock prices of its five biggest makers of panels and other equipment have halved in the past 12 months.
China's cost advantage is formidable. A research unit of the European Commission calculated in a report in January that Chinese companies could make solar panels for 16 to 18.9 cents per watt of generating capacity. By contrast, it cost European companies 24.3 to 30 cents per watt, and American companies about 28 cents.
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