Institutional and Economic Support for Renewable Energy Companies in China and eu Member States: Conflicting or Cooperative Industrial Policies?

in Perspectives on Global Development and Technology
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This research examines the photovoltaic (pv) industry, which is the fastest growing source of renewable energy, as an example in order to illustrate the development history, the status of cooperation and conflict between eu and China, and to explain the reasons behind the phenomenon. The photovoltaic industry both in China and eu experienced a period of rapid growth before the international financial crisis, driven by the explosion of the pv installation capacity and pushed by supporting policies for solar energy in eu member states and other developed countries. After the international financial crisis and Europe’s sovereign-debt crisis, because of the cut off of subsidies for solar energy in eu member states, the supply and demand relationship in the pv market was reversed. There was a serious excess capacity throughout the world and a subsequent trade war between eu and China in 2012. China and the eu have different comparative advantages. The eu is good at pv technology, producing the equipment used in pv factories and has management experience relating to the running of pv electricity systems, while China is good at manufacturing pv modules at low cost due to its innovative manufacturing in the global value chain. If the China and the eu combine these benefits, they can achieve a win-win game: China could produce renewable products more efficiently and with low environmental pollution and it could improve its management of pv electricity systems; at the same time, the eu could get low prices and high quality pv modules and reach its renewable energy targets more easily.

Institutional and Economic Support for Renewable Energy Companies in China and eu Member States: Conflicting or Cooperative Industrial Policies?

in Perspectives on Global Development and Technology

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Figures

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    2011 Product Shares in World Renewable Energy Supply.

    source: iea. renewables information 2013, oecd/iea, 2013, pp. 33

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    Annual growth rates of world renewables supply from 1990 to 2011.

    source: iea. renewables information 2013, oecd/iea, 2013, pp. 34

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    Evolution of Global pv Cumulative Installed Capacity 2000-2012 (mw).

    note: row: rest of the world; mea: middle east and africa; apac: asia-pacific region

    source: iea. global market outlook for photovoltaics 2013-2017

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    Global pv Cumulative Installed Capacity Share in 2012 (mw; %).

    source: epia. global market outlook for photovoltaics 2013-2017

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    pv Market Share Outside Europe in 2012 (mw; %).

    source: iea. global market outlook for photovoltaics 2013-2017

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    Output of pv Cells in China.

    source: china renewable energy development project, 2008; iea-pvps, 2013

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    The Proportion of Main Countries’ Solar Photovoltaics Production to the World Total.

    source: earth policy institute. ‘annual solar photovoltaics production by country, 1995-2012.’ www.earth-policy.org/datacenter/xls/indicator12_2013_1.xlsx

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    Output of Polysilicon in China.

    source: china renewable energy development project, 2008; iea-pvps, 2013

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    The Drop of pv Price.

    source: bloomberg news. the washington post. published on 23 july 2013

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    pv annual installation in China.

    source: epia, 2013

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