Some China-based PV module makers have lowered OEM quotes for PV modules with power-generating output of 250-255W to US$0.50-0.52/W to maintain orders from Japan-based vendors, according to industry sources in Taiwan.
The price reductions come in the wake of decreasing demand in the Japan market, weakened by rising procurement costs amid the Japanese yen's depreciation against the US dollar, and forthcoming reductions in feed-in tariffs by the Japan government.
The Japan government plans to reduce feed-in tariffs for PV systems and power-generating stations with installation capacity of over 10KWp to JPY27 (US$0.23)/kWh beginning July 2015, which is expected to significantly decrease total installation capacity and in turn imports of China-made PV modules, the sources said.
Japan-based PV module vendors, mainly Sharp, Toshiba, Mitsubishi and Panasonic, have increased outsourcing to China-based makers to minimize production cost, the sources said. Consequently, Japan has become the largest overseas market for China-based PV module makers, with six first-tier makers - JA Solar Holdings, Trina Solar, Hanwha SolarOne, CSI, Yingli Green Energy Holding and ReneSolar - together occupying over 40% of the Japan PV module market, the sources indicated.
The decreased PV module OEM prices are lower than production cost for fellow makers outside China, the sources said. For example, production cost for Taiwan-based PV module makers stand at US$0.55-0.60/W currently, the sources noted.
Apart from decreased demand in the Japan market, prices for 250-255W PV modules are in a downtrend because PV modules of over 260W are expected to replace the former to become mainstream models in the second quarter of 2015, the sources indicated.
