Polaris solar PV net news: President Hu Jintao issued an article, do PV investment turmoil again, with readers about the “PV is a worthwhile investment” issue, this column intends to explore a similar problem: “solar PV is worth funding? ”
These two questions are similar, since, in General, is worth investment and financing, not worthy of investment is not worth funding, but it’s really so simple?
A case study of distributed PV, we can cite a host of 2016 is reason to PV investment opportunity:
1, policy has gradually improved.
Countries was launched three years ago to distributed PV subsidy policy, after three years of exploration and practice, standard product specifications, installation, incorporation process, payment of subsidies and a series of systems, processes, and have thus far has been straightened out, found the problem has been corrected in the policy.
2, absorptive capacity is expected to increase.
On February 3, 2016, the State Council decided to spend 700 billion agricultural network, speed up the upgrading of rural power network in the poor areas and the Western, improve the acceptance of distributed renewable energy power generation capacity on February 16, 2016, released the National Energy Board the National Energy Board on the “three North” area renewable energy to dissolve notice, focus on solutions to the problems besetting eliminate problems in the photovoltaic industry.
3, subsidies in arrears is expected to solve.
On February 29, 2016, the national development and Reform Commission issued the Declaration on promoting “Internet +” smart energy development guidelines, proposes the construction of renewable energy subsidy mechanism in real time, realize the subsidy of measurement, certification and settlement linked to renewable sources to generate transactions in real time, solutions for subsidy arrears. In addition to long-term national subsidies, some local governments may also provide short-term local subsidies. Last year also introduced PV subsidy policy on poverty reduction, by the local government and agricultural facilities for photovoltaic projects for poverty alleviation 35% initial investment subsidies, 20% initial investment subsidies given to large ground power station, State subsidies according to the proportion of the initial investment configuration.
4, narrowing the cost gap between thermal power.
Rapid expansion of PV scale at the same time, photovoltaic industry technical progress accelerated, resulting in costs of PV power has fallen sharply compared with five years ago, and the downward trend is continuing. Will not become as cheap as power, or less? This for sure, but not impossible.
Policy determines the number of hours to implement grid and power generation case, PV can be long-term, stable income generating assets. In many financial products and solid industrial yields are falling today, photovoltaic power plant has great financial significance of asset allocation.
But in the eyes of most financial institutions, photovoltaic power plant finance project has little appeal, what where?
PV earnings certainty, is based on fundraising ability, fundraising costs can be controlled as a prerequisite. The hengda group, for example, announced September 2014 in 90 billion into the photovoltaic industry by March 2015 formally renounced the solar strategy, only just about half a year’s time. Evergrande’s abandoned, primarily for two reasons, one is not to form a familiar photovoltaic technologies, markets, policy and professional team (cross-border investment, taboo), second, compared to total liabilities and net profits are too high, can’t raise enough money. From the perspective of evergrande, which can accept the cost of financing is limited, otherwise it is not making any money from the perspective of financial institutions, big long-term demand for low-cost funds, only when sufficient solvency of owner investment is very low risk project, can be met. Evergrande’s balance sheet to determine its solvency in the very worst case worst constant cross-border investment, and there is no formation of professional teams, project risks are not low; and, finally, asymmetric information increase the difficulty of the degree of risk and financing of the project. Therefore, the constant 90 billion into the PV industry’s horn just blew to an abrupt end, is something reasonable.
How to break this problem? PV industry Fund can be alleviated to a certain extent similar to evergrande has faced financing difficulties. Industry Fund of assets, and management people of other assets is isolation of, management people of assets liabilities situation not effect its financing and claims debt, on industry Fund by investment of PV power station for monitoring and big data analysis of resistance also will reduced; financial institutions as industry Fund of investors and non-creditors, compared easy on industry Fund by investment of PV power station gets more full of information, even can teamed up Ali such of Internet giant help push legend in the “Ali energy cloud plans”, at any time understand, and Control the risk of investment projects. Preceding the Declaration on promoting “Internet +” smart energy development guidelines, all in the energy industry, significance to the PV industry is one of the largest, this is a breakthrough. It is reported that Ali has reached an agreement with some of the leading PV enterprises wisdom of PV power station, energy, Internet, Internet financial services, cloud computing, big data, information security, and other areas of cooperation. If one day, queries like PV information as easy as querying enterprise registration information, to financial institutions, PV power plant project financing risk is much more controllable, its willingness to provide financing will be stronger.
However, only mastered the PV of all kinds of information and data on financial institutions, does not necessarily mean that all of them. Hung Wei-Director of the Institute of energy economics said: “capital supply and construction of qualification of PV, qualification, qualification, operational qualification judgement of grid-connected capacity asymmetric. Because of this asymmetry, finally met with both supply and demand and supply side does not know how to do problems often occur. PV Conference, the audience surrounded by most of the speakers must be representatives of financial institutions, when the delegates when faced with a large number of power plant projects will inevitably discourage because they have no way to judge so many professional issues above. In the current reality, the PV many of funding judged also on ‘ empiricism ‘. “Solar PV professional problems of fund managers to really understand, but the role conflicts of both supply and demand of funds, managers of financial institutions cannot rely exclusively on professional competence. Therefore, the PV industry after poor fund management provides level funding, financial institutions priority funding, it is best to have a relatively neutral semi-official association level jam leading into funds, or hire a financial institution specified by the professional body, as investment adviser to the Fund.
About the author:
President Hu Jintao, a national high-tech zone Committee member, for more than 20 years experience in financial institutions and top law, dedicated to exploring the road of integration between financial services and legal services.
Original title: the PV finance