The Chinese government has excluded almost 80% of operating manufacturers, including Shunfeng and LDK Solar, from benefitting from domestic support measures as it looks to curb oversupply and increase the quality of its solar manufacturing sector.
The ministry of industry and information technology (MIIT) received 500 applications for the list “photovoltaic manufacturing industry norms conditions” [sic], approved companies that can continue to take part in state-run tenders and support mechanisms.
An initial list of 134 companies was released in November and a final list of 109 published on 30 December following “expert review”.
Many of the omissions are from rationalising subsidiaries into smaller groups.
The criteria looks at a number of factors including minimum conversion factors for solar cells, minimum manufacturing capacity for polysilicon, ingot, wafer and rod producers and environmental conditions as well.
Companies not on the list will not be able to benefit from domestic policy support, take part in domestic tenders or benefit from export tax rebates.
In August 2013 as details of the proposals emerged, Lu Jinbiao, a senior official at China's GCL-Poly Energy told Reuters that it amounted to a cull.
“Most producers will be eliminated rather than acquired. This may sound cruel, but is the reality as they are technologically uncompetitive,” he said.
The application process will be repeated every six months giving companies time to upgrade their facilities and practices to meet the criteria.
Shunfeng, which is in the process of buying Suntech’s Wuxi-based manufacturing operations, was also left out.
The company is looking to move downstream and today announced it had grid-connected 890MW of PV power plants in China.
Shunfeng told PV Tech it had chosen not to apply to be on the list and said its business would not be negatively affected as a result.