First Solar Inc. and China Power International New Energy Holding Ltd. announced that they will work on solar energy projects in the United States, China and other markets across the globe. First Solar is one of the leading U.S. solar panel manufacturers.
The company is trying to gain some ground in the China solar power industry in time when the European market is facing some uncertainties due to legislative changes. First Solar and Suntech Power Holdings warned that the impending cuts in subsidies by the European governments for solar panels can result to lower demand and prices of solar products.
Both Suntech, which is based in China, and First Solar have increased their production of solar panels in the last few years because of the demand of solar power in Europe and other countries. Although both companies enjoy increasing sales outside Europe, it remained the largest market for solar panels with 80 percent of the global demand coming from the continent last year. The region is expected to be on top of the solar power market in 2011.
According to its financial reports, First Solar’s first quarter earnings is down 33 percent compared to last year’s numbers of the same period. This is due to lower solar panel sale prices, higher costs of installation, and a decrease in European demand. Sales of its solar panels are down 14 percent compared to last year.
This is the reason why First Solar wants to branch out to other solar markets and one of its main targets is China. First Solar wants to diversify and the company is also interested in helping countries develop more sustainable long term policies. Under its deal with China Power, the two companies will explore solar power opportunities in the country.
First Solar will also help China Power find investment prospects in the United States and other countries. To its credit, the Chinese company has 2 gigawatts worth of projects within China. Plus First Solar has the expertise and a 2.4 gigawatt pipeline in North America.
Last January, First Solar also signed a memorandum of understanding with the China Guangdong Nuclear Solar Energy Development Co. to build a solar power plant in Inner Mongolia. Negotiations for the said project are still ongoing and the company declined to comment on a timeline of the start of construction.
China is seen by solar power companies as the next big market. The Chinese government has stated that it wishes to decrease the nation’s dependence on fossil fuel as well as decrease pollution.