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Chinese Energy Company Takes Advantage of Failing US Solar Firms

By Charles Kennedy | Thu, 10 January 2013 22:46 | 1

A few years ago investors were pouring their money into Silicon Valley start-up solar companies that hoped they could revolutionise the young, expensive solar industry.

Unfortunately no one had banked on the dramatic fall in photovoltaic prices, driven by falling prices for raw materials, and Chinese government subsidies which led to a huge overcapacity in the market.

The drop in prices devastated the Silicon Valley companies, and despite developing the new technology known as ‘thin-film solar panels’ they couldn’t compete with cheaper silicon panels. The US government tried to help by imposing large tariffs on all Chinese imported panels, but it was too little too late as most balance sheets had already been crippled and investors had been scared off. Some of the companies, such as Solyndra, went bankrupt.

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The CEO of Miasole, one of the most promising of the Silicon Valley solar start-ups, has just announced that the Chinese energy company Hanergy Holding Group has finalised the purchase of the company and for a fraction of the cost that has been invested into it.

Hanergy’s acquisition follows the recent purchase of another thin-film solar company which was part of Q.Cells, a bankrupt German solar company. The two deals mean that Hanergy has acquired an array of valuable patents that were developed for hundreds of millions of dollars, for an incredibly low cost.

Hanergy is develops hydroelectric dams, and Li Hejun, the chairman, has explained that each year it’s dams generate several hundred million dollars of free cash flow, which it has decided to invest in solar energy. Currently Hanergy owns six thin-film solar factories, with three more under construction. It hopes that developing thin-film solar technology will enable it to avoid competition from other solar manufacturers such as Suntech and Yingli.

By. Charles Kennedy of Oilprice.com

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  • Michael Joseph on January 11 2013 said:
    This is disastrous. Do you trust Chinese quality of their products.? I don't.

    And it is even more so from the competition point of view. How is it expected to have the prices kept low if all the production will come from one source, and in one country.?

    I hope there are still others in the West producing thin-film panels, or come up with an alternative that negates the Chinese advantage.

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