Chinese Giant SANY Plans $7.7 Billion Distributed Solar Investment
Originally published on Sustainnovate.
In a bit of an unexpected move, the biggest heavy machinery manufacturing firm in China, the SANY group, recently announced that it will be investing around $7.7 billion (RMB 50 billion) into various solar photovoltaic (PV) projects in the country over the next 5 years.
The company’s first solar PV project — a 3.82 megawatt (MW) project which was recently finished and connected to the grid in the Changping District of Beijing — appears to have been intended as a pilot project, to test the waters so to speak. Given the success of the project — an operational efficiency roughly 10% above the average — the firm now seems intent to go full speed ahead with its solar plans.
A rep from the company recently commented that, while there were various different components to the company’s solar PV strategy — investments into solar PV project construction, microgrid development, solar PV project operation and maintenance, etc — the focus was on distributed projects, rather than large-scale ones.
Give the success of the company’s wind energy business — around $1.1 billion in sales during 2015 — the aggressive move into solar shouldn’t be surprising. The company seems to have determined that the distributed sector is in a boom phase and ripe for the taking.
The SANY group currently possesses an annual income of over $12 billion. Following the beginning of the decline of the construction boom in China a few years back, the company began diversifying into new business areas.
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“Following the beginning of the decline of the construction boom in China a few years back, the company began diversifying into new business areas.”
That is an important line, if they wanted to live on they needed something new to build. Distributed PV has been behind plan in China so would look like a win win.
Presumably as a large-scale machinery manufacturer they will be targeting the industrial and commercial markets with multimegawatt plants, not the very different residential one. China still awaits its SolarCity. It won’t be based on the leasing ripoff, as Chinese middle-class households are flush with cash, unlike American ones.
Based on news reports and what I have seen on TV it seems to me most of China’s middle class live in condo. There is no doubt many are flush with cash but how many own a place you could install roof solar at?
If you look at aerial or satellite photos of Chinese cities you will generally see a lot of of stand alone housing, so there is plenty of room for household rooftop solar. The large majority of the population live in low rise housing. And with a home ownership rate of 90% there is not a large renter population that may not have an incentive to install rooftop solar.
I would not say a majority live in single/double storey houses, but a lot will continue to live in such houses/mansions.
Then there are golf courses, schools, universities, that may be single storey buildings.
Well, China’s urbanisation rate was 56% at the start of this year, so I definitely think a majority of people would still live in low rise housing. But China’s planners are fond of putting people in high rise accommodation in urban areas to save on land and infrastructure costs, so I would guess a large portion of those living in urban areas would be in high rise dwellings.
The grid in China probably functions most of the time. They could install batteries in apartment blocks to shave the peaks.
And there may be a few single storey schools that can install solar panels.
But they may want to focus on Pakistan, which is facing an electricity crisis and most Pakistanis do not live in apartments.