Wang Yingge, Marketing Director, LONGi Solar
Solar power players around the world are feeling anxious in the wake of the global health challenge which has impacted the business as usual scenario. There has been a slump in energy demand, stoppage of project construction work, invoking of force majeure, a halting of trains and flights, etc.
It is natural to feel uncertain about this historic shock, and how this could impact our customers (project developers and EPCs), as well as their customers (power off-takers). In the entire history of LONGi’s existence, we have managed through several global financial crisis situations. I am confident that we, as an industry, will successfully sail through the current one as well, and there are several reasons why:
- While the Covid-19 crisis presents the biggest shock to the global energy system in over 70 years, solar power represents the most stable option in the marketplace.
- All recent industry reports point towards the solar power sector’s resilience to COVID energy system shock. IEA’s Global Energy Review 2020 states that renewables are set to be the only energy source that will grow in 2020 despite the overall energy demand predicted to fall by 6% during the year.
- Solar demand from commercial entities continues to increase, as they seek energy independence, ways to reduce their operational costs and become more environmentally friendly.
- And while work on some solar projects has been delayed by the outbreak, solar power’s favorable cost economics will help the industry to continue growing in 2020, and next year even as oil, gas and coal companies struggle financially or seek bankruptcy protection.
- Special attention is, therefore, being given to stimulating investment in clean, renewable sources of energy in countries including China, the US, and India (our three biggest markets), raising our ambitions for the climate so this crisis can give rise to a new, green economy.
So overall, even if solar project development has temporarily slowed down, the annual impact is manageable, and the long-term outlook stays positive.
As far as LONGi is concerned, the crisis has had minimal impact on our receiving orders. In fact, we have already saturated our order book for the first half of the year, and several orders are locked in for the second half of 2020 as well. LONGi's shipment estimates for 2020 have, therefore, not changed.
Our steady operational strength, abundant cash flow, and secure supply chain system helped us stay resilient. Based on LONGi's vertically integrated industrial chain, and decentralized production layout in several countries, the company's production capacity was least impacted by the epidemic and recovered as quickly. In mid-March, LONGi started production at its 5 GW module plant in Jiangsu province, providing additional assurance for the supply of 166mm wafer-based modules. LONGi's subsequent capacity expansion plans are also on track to meet the global demand for efficient PV products.
For PV industry, the best product guarantee for a customer is the strength and stability of the supplier. LONGi, through its strong value chain, the risk control ability, and the capability to respond well to market challenges, has always been and will continue to be the most reliable PV supplier globally, creating long term value for our customers and partners.