China's Rising Costs Actually an Advantage for Taiwan's Solar Module Industry

Taiwan's solar-module industry is expanding production to fill the niche left by their Chinese competitors whose global shipments have seriously fallen due to a string of anti-dumping taxes imposed by the West, not to mention China's surging manufacturing costs.

Industry executives say that Taiwan's leading module makers, including Neo Solar Power Corp., Inventec Energy Corp., Tainergy Tech Co., Ltd., Gintech Energy Corp., and Apollo Solar Energy Co., Ltd., are competing to boost production capacities.

Giga Solar Materials Corp. Chairman J.R. Chen points out that China's 15% lower production cost advantage over Taiwan has been almost offset by the 26% anti-dumping tax imposed by the American government.

Chen estimates Taiwan's total output of solar modules to increase to 1.6-1.7 gigawatts soon from the current one gigawatt, to be achieved by expansion projects by the island's manufacturers. However Chen feels that such  expansions are unlikely to lead to oversupply anytime soon for Taiwan's production capacity of the modules is over 10 gigawatts.

Neo Solar Chairman Quincy Lin feels that while Taiwan's salaries also climb, the production cost gap between Taiwan and  China will narrow as production costs surge in China. He predicts production cost between Taiwan and China will be equal in the solar-module industry in three years, because of the U.S. anti-dumping and anti-subsidizing taxes on China's exports to the U.S.

Neo Solar has emerged as Taiwan's No.1 manufacturer of solar cells, modules and systems in production capacity after acquiring DelSolar Co., Ltd., with output of solar modules estimated to reach 480 megawatts by the end of this June.

Gintech Chairman W.H. Pan says that the company may expand capacity through acquisitions, and that Taiwan's makers do have new opportunities despite the uncertain outcome of the anti-dumping and anti-subsidizing taxes.

Inventec has 300 megawatt capacity, making it the No.2 module maker on the island. Apollo Solar plans to boost module output to 200 megawatts from the current 150 megawatts.

Taiwan's industry executives say that Taiwan's photovoltaic manufacturers have traditionally focused on midstream operation, namely the manufacturing of crystalline silicon wafers and solar cells, to make the most of the island's well developed semiconductor industry. (KL)