Wood Mackenzie expects return to solar panel price falls this year

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An overview of what to expect in the Chinese energy market this year, published this morning, has predicted the solar superpower could add “close to” 120GW of photovoltaic and wind power generation capacity.

U.S.-owned Scottish data company Wood Mackenzie also hinted the solar module price falls which have been tracked since the turn of the Western new year would continue. WoodMac said an anticipated 20% fall in the price of wind turbines would drive down overall renewables equipment prices in the nation by 8-10% in 2022. Polysilicon shortages and supply chain turmoil saw solar panel prices reverse their long-term cost reduction trend last year.

The analyst expects China to install 20% more clean power generation capacity this year than last and said more than half of the new power generation capacity anticipated out to 2025 would come from renewables.

With electric vehicle sales expected to hit 4.8 million this year, to best a national, 2025 target of 20% of total sales three years early, China may also tighten the carbon emission allowances distributed to thermal power generators under the emissions trading scheme launched last year, and could also expand the program to the building materials sector and non-ferrous metals.

On the other side of the energy ledger, WoodMac expects Beijing to continue efforts to ramp up domestic coal supplies, following the supply shock in the final three months of 2021 which led to power shortages, and research director Miaoru Huang said, in this morning's note: “China is unlikely to significantly reduce its import dependency on oil and gas” this year.

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