At the annual meeting of the China Photovoltaic Industry Association (CPIA) in early December, 33 top PV makers signed a self-discipline pledge loosely based on the cartel of the world’s biggest oil producers. Manufacturers agreed on production quotas based on their capacity and pledged to follow the recommended price floor previously set by the association.
A fortnight later, the CPIA issued a rare open letter criticising a Xinjiang-based solar project for flouting the agreement. The subsidiary of China Energy Investment Group set a maximum bidding limit significantly below the CPIA’s price floor of 0.68 yuan (US$0.09) per watt and chose the winning candidates with the lowest prices.
“Are you trying to stop the industry’s vicious competition, or exacerbate it?” the CPIA asked.
That episode has further damaged industry morale, as industry insiders and analysts had considered the Opec-like pact as one of the last realistic efforts to save China’s 1 million plus solar-related firms that have been scarred by a year-long price war and overcapacity that even Beijing finds troubling.
