Photovoltaic industry overcapacity is just an appearance

The photovoltaic industry is going through a tough winter, but this period has also sparked deeper reflection and discussion about its future. While many are focusing on the issue of overcapacity, experts like Li Meicheng, vice president of the School of Renewable Energy at North China Electric Power University, argue that the real problem lies elsewhere. In an interview with *China Power News* on December 20, Li emphasized that "overcapacity is just an appearance," and the core issue is the lack of technological innovation. According to Li, China's photovoltaic companies have long been strong in global rankings. For example, in 2010, six Chinese firms were among the top ten globally, and by 2011, that number increased to eight. These rankings, he said, prove that China’s companies are highly competitive on the world stage. The current challenges, however, are not due to overproduction, but rather external factors such as a sluggish global economy and trade protectionism. "Most of our products are exported, and trade barriers have significantly impacted our market access," Li explained. "When the export channels are blocked, the industry experiences a sharp decline, which is often misinterpreted as overcapacity." He pointed out that even in a difficult environment, some technology-driven companies continue to thrive. For instance, Japan's Sanyo, with its HIT solar cells, remains a leader in the field due to its proprietary technology and unique product offerings. Li also highlighted that many of the photovoltaic products currently being sold globally are similar in design and function, making it easy for competitors to catch up. "If one company fails, others can quickly replace them," he noted. This lack of differentiation, he argued, makes the industry vulnerable. Therefore, investing in research and development is essential to secure a sustainable future. In terms of solutions, Li suggested that the industry should focus on distributed applications and integrate photovoltaic technology with traditional energy systems. "With strong policy support, these strategies can help companies navigate the current challenges," he said. Moreover, Li pointed out that the current downturn presents an opportunity for innovation. With many technical staff moving to R&D institutions, companies can take this time to refine their technologies and build stronger teams. "During the 2008–2009 financial crisis, everyone was focused on short-term profits. Now is the time to invest in long-term technological upgrades." He also stressed the importance of a complete industrial chain. "In the past, excessive investment led to inefficiencies and poor digestion of new technologies. Many industries failed to keep up, resulting in fragmented supply chains." Today, improving the industrial chain is crucial for reducing risks and ensuring stability. In conclusion, while the photovoltaic industry is facing a challenging phase, Li Meicheng believes it's also a moment for transformation. By focusing on innovation, strengthening the industrial chain, and leveraging policy support, the sector can emerge stronger and more resilient.

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