From following to the rulemaking, China wants to introduce photovoltaic standards

Just a few days ago, the 2012 China (Chengdu) New Energy International Summit brought some noteworthy developments. It was reported that relevant departments are considering introducing a mandatory certification and testing system for the photovoltaic industry, with plans to implement it as soon as possible next year. Concurrently, the Ministry of Commerce is actively working on foreign aid initiatives specifically targeting the photovoltaic sector. This new initiative aims to focus on over 40 African countries, driving Chinese companies to expand globally. On November 9, the Ministry of Finance, along with other ministries, jointly issued a notice regarding the declaration of solar and optoelectronic building application demonstration projects, clarifying relevant subsidy standards. To many in the industry, this appears to be the second wave of "rescue" measures introduced by the authorities for the Chinese photovoltaic industry. While these policies bring unprecedented benefits, their impact at the industrial level has yet to fully materialize. On November 14, the Wind Solar Power Generation Index dropped to a recent low of 627.59 points during the session but managed to recover slightly and closed at 634.26 points. For this "sluggish recovery," several industry insiders interviewed by the "Securities Daily" expressed general agreement that despite continuous support policies from the government, China's photovoltaic production capacity, which accounts for over 50% of the global total, remains significantly overproduced and unable to be fully absorbed domestically. The effects of these policies have only begun to show since July this year. The National Energy Administration recently upgraded its solar power generation development plan from 15GW to 21GW under the 12th Five-Year Plan, with particular emphasis on expanding the distributed generation system to include a 10GW scale. Meanwhile, the scale of centralized photovoltaic power generation will be adjusted accordingly, and the solar thermal power generation plan will reach 1GW. Since then, a series of positive developments in the photovoltaic sector have continued to emerge. Notably, in September, the National Energy Administration issued a notice regarding the scaled application of distributed photovoltaic power generation demonstration zones, followed by the State Grid's release of its "Opinions on Distributed Photovoltaic Power Generation" in late October. Furthermore, the China Development Bank's support for 12 large and small PV companies through credit policies has been viewed as significant positive steps. Despite these developments, the price trends for domestic polysilicon to components in the third quarter showed a noticeable decline, exceeding the rate of technological progress or other cost-saving measures. Critically, according to Wind Information statistics, the total operating income of listed companies in the photovoltaic sector fell by 2.52% in the first three quarters, though this represents a slight improvement of 3.53% compared to the half-year report. However, this hasn't fully reflected the favorable impact of the new policies. Additionally, the overall gross profit margin of the industry in the first three quarters was 15.33%, down 0.31% from the semi-annual report and 2.16% lower than in 2011. The Wind report noted that the financial health of the photovoltaic industry is still deteriorating, with no clear signs of an industry boom. The second set of measures appears even stronger. Consequently, it is essential for the management to deliver another round of "rescue" policies. Sun Guangbin, Secretary-General of the Solar Energy Branch of the China Chamber of Commerce for Import and Export of Mechanical and Electrical Products, stated that this would ensure the improvement of enterprise technical quality. By implementing a mandatory certification and testing system, the number of export enterprises may decrease, raising entry barriers for businesses. Similarly, foreign products entering China will need to pass these compulsory certifications. Clearly, the introduction of such systems requires the establishment of national-level certification centers and the formulation of national standards. From another angle, "in the future, PV products entering the Chinese market must comply with China's PV standards. These standards will also facilitate foreign aid and exports of China's PV products," an industry insider told reporters for the "Securities Daily." In fact, all these efforts are progressing systematically. According to media reports, several national standards for distributed power access to the distribution network have been submitted for review, and national standards for photovoltaic power generation distribution networks have also been submitted to the National Standards Committee. This indicates that the Ministry of Commerce's efforts to promote the "going out" strategy for Chinese enterprises are well underway and have garnered praise within the industry. An industry insider remarked, "This could provide significant opportunities for breakthroughs for the Chinese PV industry and offer valuable lessons for exploring other emerging markets."

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