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Chinese Solar Panel Company Close To Bankruptcy

May 4, 2016
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By Paul Homewood  

 

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http://www.bloomberg.com/news/articles/2016-05-02/yingli-slumps-after-solar-manufacturer-warns-of-bankruptcy-risk

 

My second item of renewable news comes from Bloomberg:

 

Yingli Green Energy Holding Co., once the world’s biggest solar manufacturer, plunged the most in more than seven months after signaling it may be teetering toward bankruptcy.

Yingli declined 21 percent to $3.60 at the close in New York, the most since Sept. 29. That followed an 8.1 percent drop Friday after the Chinese solar company acknowledged “substantial doubt as to its ability to continue as a going concern.”

Yingli said Friday that it’s still in talks with creditors about repaying loans due in two weeks, and its losses for 2015 probably would widen because of a series of write-offs, the sliding price of solar panels and declining shipments caused by a shortage of working capital.

“It looks like they are not getting bailed out and they will need to file for bankruptcy,” Gordon Johnson, an analyst at Axiom Capital Management, said in an e-mail Monday.

Yingli hasn’t reported a quarterly profit since 2011 and has been in breach of loan covenants for at least a year. It has been kept alive by state-backed lenders led by China Development Bank Corp. The company said in April it would be “very difficult” to repay 1.4 billion yuan ($216 million) of notes due May 12.

http://www.bloomberg.com/news/articles/2016-05-02/yingli-slumps-after-solar-manufacturer-warns-of-bankruptcy-risk

 

This news follows on from the financial problems of the likes of Abengoa. But, if anything, Yingli is even more significant.

We have heard a lot about how the reducing price of solar panels has made solar energy supposedly competitive. But, as I have pointed out, this, to a large extent, has been the result of dumping by Chinese manufacturers.

As with the dumping of steel below cost, this is impacting on the manufacturers themselves, even in China. It is astonishing that Yingli has not shown a quarterly profit since 2011.

It is obvious that current market prices for solar panels are financially unsustainable.     

12 Comments leave one →
  1. May 4, 2016 6:43 pm

    Reblogged this on Climate Collections.

  2. May 4, 2016 6:52 pm

    There is also another reason. Yingli is polycrystalline silicon (mottled light blue), cheaper than SunPower monocrystalline silicon (deep uniform blue black) but also less efficient. SunPower’s best panels (x22) are 22.8%. Yingli’s best (YGE-Z) are 16%. SunPower therefore beats Yingli on BOS (smaller roof, fewer panels, less mounting bracketry…), and can compete at the installed system level despite Yingli dumping.
    And the other blow is First Solar’s steady improvement in their CdTe (black panel) efficiency. In Feb they announced a new lab record, 21.5%. Their 2015 production panel average was 14.7%, and they have said they will acheive >16% by YE 2016 based on the February lab result. For a whole bunch of reasons like manufacturing at the panel level (no assembly of cells into panels) First Solar costs in Arizona are less than half of Yingli in China. FS cost was $0.63/watt in 2013, and they told shareholders it would drop to about $0.48/w by YE 2016 (and that includes the efficiency improvement). Yingli is crushed between superior performance and superior cost by two American companies.

    That said, solar makes little sense in the UK. For solar, you need lots of sun.

    • Billy Liar permalink
      May 4, 2016 7:44 pm

      What will the EU do about cadmium based cells? IIRC, cadmium is on the naughty step in the EU; it is on the list of proscribed materials in the ROHS legislation.

      They stopped us using tiny little CdTe light dependent resistors so I imagine whole panels of the stuff will be a definite no-no.

      • Billy Liar permalink
        May 4, 2016 7:49 pm

        Correction, I meant CdS light dependent resistors.

      • Adam Gallon permalink
        May 4, 2016 8:23 pm

        If it’s “Green” that will be ignored, like banning use of Mercury in barometers, but allowing in low energy bulbs.

      • May 4, 2016 8:33 pm

        Billy, P layer is CdS. N layer is CdTe. They named the system CdTe. So your concern is legit. So First Solar provides an endmof life complete recycling program as part of the initial purchase price. That is why their customers until now have been exclusively utilities. They strip the panels and reuse all the layers (chemical separation) except the front glass cover. Or at least that is what their website says they do.

      • Billy Liar permalink
        May 4, 2016 10:57 pm

        Thanks for your response Dr I, I await with interest the EU response to a massive influx of non-ROHS solar panels. We are talking about the entity that impounded 40,000 incandescent light bulbs imported into Germany after they were banned in favor of mercury containing fluorescent bulbs.

        http://savethebulb.org/heatballs-held-by-german-customs

    • May 5, 2016 7:57 am

      “First Solar’s steady improvement in their CdTe”
      @Ristivan I just read this : CdTe (cadmium telluride) “Cadmium .. toxic at even tiny doses”
      “CdTe are used mainly in large solar power farms, as the cadmium toxicity makes them unsuitable for residential systems,”

  3. May 5, 2016 7:35 am

    2016 “Yingli Green Energy Holding Co., once the world’s biggest solar manufacturer, plunged”
    Em that’s funny cos 12 months ago it was :
    2015 “Hanergy., once the world’s biggest solar manufacturer, plunged”

    How are they doing ? The corp soldiered on , but here’s a story from Hanergy TF auditors express ‘significant doubt’ as to company’s solvency

    Hanergy’s thin-film equipment manufacturing subsidiary, ..has technically cancelled a 2015 major order worth US$660 million
    There was strange structure to the deal in that to finance the “equipment manufacturing” Hanergy was supposed to issue new shares, but since they are worthless never did.

    But Hanergy seemed to have booked much of the profits from this deal already, even though it’s not going to happen.
    “The cancellation ..is the last of a number of similar sized and valued deals”

  4. May 5, 2016 7:49 am

    Thin Film solar panel materials are often toxic, or extremely rare. That’s not often been mentioned
    It’s only when I read an article entitled “record for non-toxic, thin-film solar cells“* That I realise that that in Thin Film upto now there have been 2 types : CdTe (cadmium telluride) and CIGS
    “Cadmium and selenium are toxic at even tiny doses, while tellurium and indium are extremely rare.”

    *The 7.6% record is not that amazing cos thinfilm gets nowhere near the 20% efficiency of thick panels

    • Dorian permalink
      May 5, 2016 2:18 pm

      With all due respect guys, I think you are all missing the point.

      I am all too welcoming of having a discussion in solid-state physics about the pros and cons of the respective solar technologies, as a physics man myself, it has lots of interesting issues.

      BUT! Think about the BS that has been going on for the last 5 to 7 years with solar! Solar prices have been coming down and the LOONY LEFT have been using this as a cause célèbre that we should be changing our economic and social focus to renewables. Well, with the imminent failure of this Chinese solar company, and since it has been the Chinese that have been largely pulling down solar prices in the solar market, doesn’t this suggest that the solar market for the last several years was a FALSE market? Furthermore, doesn’t it also suggest that solar prices today are not priced at true market value and that all the money going into solar is about to end or dry up? Also, doesn’t this strongly suggest that the solar market, shortly, will reverse correct, and thus prices will start going up, markingly so!

      Could this well be the end of the false solar market? And if it is, if you are one those poor suckers in the solar panel research and development, or an engineer in the solar industry, this could be the big warning to get out! FAST!.

      Governments are bailing out on the solar subsidies all around the world. The Solar Panel market is about to go the way of the Hydrogen Car market of the early 00s.

      As for the research in solar, I think its going back to the good ol’ days. And if you’re as old as I am, you know they were very bad days.

      Even Science has to be economically viable. Never just focus on just the science, always factor in the economic TRUE value, and that means PRESENT VALUE not FUTURE VALUE.

      Don’t forget they have been researching a viable way to do hydrogen fuel cells now for nearly 200 years! And still hydrogen fuel cell science and technology is not economically viable. I have a strong belief that solar panel technology has the same economic handicap. That is where the real argument should be.

  5. It doesn't add up... permalink
    May 7, 2016 6:16 pm

    This analysis of China’s renewables industry is from 2 1/2 years ago:

    http://business.financialpost.com/fp-comment/why-chinas-renewables-industry-is-headed-for-collapse

    It’s looking like a prescient forecast. Perhaps others should pay more attention.

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