The Chinese Solar Debate: Should Consumers Start To Pick Sides?
When it comes to food, clothes and manufacturing, ethical consumers have three mantras: local is best, provenance is everything, and quality before cost. On the whole, it is accepted that this excludes mass-market imports from China. This is all very well for relatively affordable items, or products for which there is a wide variety of choice. But what happens when the price differential between a Chinese product and the alternative is substantial? When it comes to a decision of macro environmental importance – solar for your home – do the smaller issues really matter?
China is now the world’s biggest supplier of solar panels, a meteoric rise charged by multiple government incentives, state support packages and the very low cost of labour. Over the last 4 years, Chinese and Taiwanese manufacturers have increased their solar production volume by 120%, while companies in Germany and Japan only saw growth of about 40%. The explosion of Chinese panels onto the scene last year left in its wake a catastrophic demise of domestic production, and dramatic price drops in European countries and the US.
Some would say this is capitalism at its best, with the consumer emerging as the runaway winner. Cheaper PV means solar is more accessible to more people, which can only be a good thing – right? That’s down to the consumer. For most homeowners, investing in solar for their home is a big deal, with lots of things to consider. Should the origin of your panels be one of them?
Here are some sobering points for the ethical solar consumer to contemplate…
1. Environmental Cost
Chinese manufacturers do not have to comply with all the environmental criteria and pollution legislation Western governments have developed to ensure their own manufacturing is responsible, sustainable and accountable. This was acutely highlighted last September when a solar panel factory was shut down in eastern China following a large-scale protest from local people concerned about the large volume of fish deaths in local rivers. Test on water samples revealed high levels of toxic fluoride. The company, Jinko Solar, was accused of dumping hazardous waste into the water, although a spokesman pointed to an accidental weather-related spillage. Reports of high cancer rates in the area were not investigated.
2. Economic Impact
Saturation of cheaper imports is driving the market into crisis. With the arrival of Chinese solar in the UK, solar installation prices dropped by a third; European markets are in turmoil; and the devastating impact on the US has been well-documented (see point 3 below). The decline in panel prices globally is the result of over-supply and increasing production overcapacities, which many observers pin on the rise – and rise – of Chinese solar manufacturing. So far, so capitalist…but the twist comes with the investigation into unnatural market forces operating within China, allowing them to ‘dump’ units in overseas markets and treating them to massive state subsidies.
3. Political Unrest
When it comes to solar power, the sun has definitely set on US/China relations, which are distinctly cooler since the Senate’s allegations of predatory practices and China’s retort of American protectionism. The high-profile collapse of Solyndra Solar, Evergreen and SpectraWatt last year was embarrassing for Obama, who had invested heavily in the industry. Many US domestic companies, such as one of the market leaders First Solar, are struggling. Meanwhile, Chinese annual solar exports to the US grew to $2 billion and America had a solar trade deficit with China of over a billion dollars. Earlier this year, however, the U.S. announced anti-dumping tariffs of up to 250% on Chinese solar panels. In response, China began an investigation into US polysilicon suppliers, used in solar cells. Such political unrest has chilled the solar industry globally, with Germany stating last week they may also take action.
4. Sustainability Issues
The Chinese solar industry is still young and recent reports suggest it may now be paying the price for its rapid ascent. Companies buying in Chinese panels – and therefore consumers opting to use them – should be cautious about the longevity of Chinese firms in relation to the 20 year guarantee. Many companies are experiencing massive downturns and even operating at a loss, subsidised by the state.
5. Quality Questions
Chinese panels don’t have to compromise on quality to be cheaper – it’s mainly a matter of scale – but some questions have been raised about certain brands. That being said, in some cases Chinese panels demonstrate better efficiency than foreign rivals due to the materials used. Perhaps the best observers of quality are the installation companies who buy the panels. What do they think about China? UK company Southern Solar state that a lot of thought went into whether to offer Chinese panels or not. Chinese supplier Trina seemed to fit with their own priorities: Trina had been around since 1997, they comply with the ISO14001 environmental management system, and the quality is still there, according to independent performance tests.
This is the kind of background check worth undertaking, too. It is a case of ethical math – should you let your principles price you out of the solar market? What’s good for the planet, good for politics and good for your purse are rarely one and the same thing. Make your decision wisely.
Holly Dawson is a British writer and editor, spreading the word about all things eco and ethical. Follow her on Twitter @hollyjdawson.
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