Xian de: distributed PV market-oriented policy improvement recommendations stop flagging reselling

Polaris solar PV net news: after starting the domestic PV market, under the fast-growing solar PV installed capacity, also faces policy, enterprise restructuring and to deal with the problem, notably the National Energy Board injunctions govern reselling “flagging” problem, distributed PV development are still not up to expectations, financing and so on.

In an interview with reporters, jinko Chairman Xian de believes that market demand will continue to grow, but already from the early variety of Halo came out, not only by virtue of size and capital, competition becomes a technique, refinement of the cost control and management of the industry.

Distributed PV policy at issue, Xian de said in an interview with reporters, distributed uncertainty factors rooftop PV’s current business model is still more policies also need to improve, and strengthen the implementation of policies.

Is opportunity distributed ground station

Reporter: earlier this year the State determine 8GW distributed PV installed capacity target of the year, from the current development, the target must finish, from a professional point of view because where is it?

Xian de: 2014, distributed development is one of the hottest topics of the photovoltaic industry, early decided 8GW installed capacity, however the actual item network and 8GW does have a gap. The main reason is not currently distributed business models mature, especially roof distributed project: end users ability to eliminate uncertainty and continuing, risk of a power plant after the completion of the property right, these questions will affect the ROI of distributed projects.

The other hand, distributed project billing the new deal introduced relatively late. In September, the National Energy Board new distributed policy States: individual item below installed capacity of 20MW, access to 35,000 volts power grids, barren of PV plants are distributed, and can follow the “full Internet” approach, namely, the total generating capacity of the project consist of power grid enterprises in new benchmark local PV price to buy. We can call it the ground distribution distributed Outlook is good on the ground, installed capacity will be greater in the future, driving overall installed capacity of distributed and put on the expansion, insufficient quantity of roof water can be distributed power station.

So even though this distributed grid integration project size to 8GW, but the project started and many, might even exceed 8GW. Mainly because in September distributed following the new deal, the eastern region in November, December many distributed ground station is under construction.

Reporter: photovoltaic power plant in the past is divided into large ground stations and distributed PV power station and ground station favored by developers from subsidies and policy perspective, ground station, where’s the pros and cons of distributed?

Xian de: pros and cons of the ground station is also very obvious, ground power station typically build in good light conditions in the Western region, harmonization of settlement, investment returns are clear and predictable business models mature, so investors are favored. Problems but it is funding subsidies lags, the enterprise needs high financial strength.

Disadvantages of distributed, as we talked about before, business models as immature and uncertain returns on investment, project financing is more difficult, additional project management costs are high.

Distributed ground station, from an investment perspective, in September after the new deal, if full Internet access methods, the price of new benchmark standards relate to the local photovoltaic power plant price, such as Eastern region by 1 Yuan/kWh feed-in tariff. In this case, distributed ground station settlement in the month, power grid Corporation paid, you do not need the subsidy program. Will be solved we have said before, the distributed lag of uncertain return on investment and subsidy issues.

But on the other hand, if there is distributed the owner power to dissolve well, generating all its own to dissolve, in industrial electricity prices around 0.9 Yuan in Eastern Canada on the basis of unified national 0.42 Yuan subsidy per kilowatt, 1.32 Yuan/degrees can be obtained income, is higher than the full level of Internet access of 1 Yuan/degree.

But anyway, in September with a new deal, good for promoting the development of distributed.

Reporter: national high hopes for distributed PV, and policies that promote the development of distributed PV. Have any suggestions for domestic policy of distributed PV design?

Xian de: this is a commercial model, that is return on investment issues. Business models of large ground station has matured, investors can refer to the power station construction and operation costs, solar energy resources, Internet benchmark prices to calculate future investment returns.

Distributed power plants are complex, risky. In particular, the distributed power plant involves three parties as the roof. A developer is to invest in power plants, and the second property of the roof, there is power. Developers, owners of the factory roof, energy management contract signed by the parties, the owner to dissolve a lifetime supply of electric power.

First charge on electricity tariffs, there may be risk of electricity default owner. Number in addition to electricity and electricity continued uncertainty, developers of standards of electricity sold to owners in accordance with industry is 0.9 RMB, combined with State-subsidized 0.42 Yuan, total 1.32 Yuan/degree, financial model clearly predictable. But if the owner can not eliminate, power section, is the new benchmark in accordance with desulphurization power price added 0.42 Yuan subsidy totals about 0.82 Yuan/degree, the financial model is completely different.

Roofs of distributed power plant property rights are unclear. Is the owner of the roof, power plant developers, if owners want to tear down the factory of the future building, would have power to dissolve disputes, property rights.

Roofing distributing countries in the promotion of jiaxing’s experience. Unified management of distributed power station in jiaxing, the Unified tariff, and the establishment of sector-specific coordination of electricity charges, transfers power to dissolve. A useless, can adjust to the other plant uses. Private enterprise in jiaxing and area electricity shortage, economic good, and also extra subsidies, marketing can also depend on an international reality.

Domestic policies are aimed, but implementation depends on the actual implementation. Roof distributed need some policy adjustments, resolve concerns. Policy enforcement needs to be particularized, such as problems in distributed development on the ground in Jiangxi, 80% forest, does not belong to barren areas, may be able to work around it.

Market-oriented way to stop flagging reselling

Reporter: domestic policy, driven by rapidly evolving market, there are also some new issues. For example, flagging the speculation for some time has been outstanding, what should put an end to this situation? How the overall Outlook of the future?

Xian de: the current approval authority has been delegated parts of the PV power station, energy management and allocation of capacity. Local governments have their own considerations, flagging to local businesses. Photovoltaic power plant construction not only requirements for the strength of enterprises, also require businesses to have professional expertise.

Local access to flagging enterprise does not have to be a professional photovoltaic companies, since bank financing is difficult. For power plant construction is not professional, it is difficult to guarantee the quality of power, so they seek transfers. Now capital more and more into PV, flagging transfer prices have gone up and reap huge profits and increased industry costs, and bad for the industry.

When local Government was flagging, you should select companies with financial strength and industry professional, is good for promoting the construction of ground station of large scale and high quality.

Marketization way I tend to choose power plant developers, provisions not to rush through the threshold, or a restriction of certain types of companies to invest again, while other enterprises exclusive market. Country policies to limit speculative flagging is a good thing, but it is more like conventions and local government, there is no specific support measures, if there are any reselling of flagging, how to discipline, how to enterprise, is not clear.

As for the future, said market demand, I think that since 2004, the market demand is growing fast, global PV installed capacity of 1GW to 45GW above, system and component costs are falling, if by 2020 and parity, the market Outlook is still very good.

Reporter: jinko manufacturing ranks rising, while also doing apt power manufacturing company specializing in the field of power what are the advantages and disadvantages?

Xian de: many companies do lower station, in order to promote upstream manufacturing shipments. We are different, jinko manufacturing product quality, cost control, scale advantages, has been leading in the industry. We do power plants, is the transformation of the company from manufacturing to energy suppliers.

Based on this, our power from sitech jinkosolar spun off. Investment in manufacturing and electricity is a different business model. Our position is that both manufacturing and investment in power, have to be competitive in the market. Investment in manufacturing and electricity competition faced by competitors, competitors are traditional manufacturing enterprises in the manufacturing sector, investment in power rivals is the State-owned power group, zhongmin, and wind, and so on.

Sitech power split has attracted three shareholders separately is Macquarie, CDB capital, new horizon, coupled with the advantages of business models, the Group’s parent company, technical professional, I believe that the ATP power with strong competitiveness in the industry.

Reporter: power plant developers and traditional manufacturing varies greatly, needed capital and management skills are higher for photovoltaic manufacturing companies in transition power companies what do you think?

Xian de: business model is still the most important. Every company has a different business model, the business models are different for each regional market. Company to choose the suit market business model. Common energy company, is buying station and holding operations. Us energy producers from manufacturing, involving longer industry chain, including project development, EPC, project finance, construction, power plant operation and maintenance of the project.

This mode has the advantage is low cost, makes all her own products, quality is guaranteed. There are also disadvantages, the industrial chain is too long and needs to be managed in place, poor interface will cause problems.

Reporter: hydropower development in need to precipitate a lot of capital, how to deal with funding challenges that followed?

Xian de: more solar power station is an investment industry. Need to invest heavily in the construction period, cost recovery for a long time, the capital may take 7-8 years to recover. Upon completion, as long as the Sun can generate electricity, supply chain and management costs are negligible in the late.

Because of this, PV development abroad is very good, many large institutional investors including pension funds, are held by pension funds public, raise funds for power plant construction.

In addition to innovative financing models. Domestic power station assets securitization has been for the industry, in my opinion, the new form of financing is mainly look at policies. Bao can raise money for PV power plant, such as balance, requires relevant departments for approval. For now, domestically some innovative financial products, such as financial leases and other modes.

For companies, the cost of capital is crucial. No matter what kind of financing is capital cost competition, power gains more than the cost of capital is the successful financing channels.

PV power station, gets a steady income, and never worry about late-what’s the problem.

Apt for power, we have completed the Macquarie, CDB capital, new horizon of three equity investments, then went public, mobilize funds for power plant construction.

In addition to innovative financing models. Domestic power station assets securitization has been for the industry, in my opinion, the new form of financing is mainly look at policies. Bao can raise money for PV power plant, such as balance, requires relevant departments for approval. For now, domestically some innovative financial products, such as financial leases and other modes.

For companies, the cost of capital is crucial. No matter what kind of financing is capital cost competition, power gains more than the cost of capital is the successful financing channels.

Original title: distributed PV market-oriented policies to improve the Corporation recommends stop flagging reselling

Posted in News.