Could The Corona Virus affect Manufacturing and the Price Of Solar?
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Since 2009 China has been the world’s largest exporter of goods across various sectors. Whilst its key exports are automatic data processing machines, clothing and mobile phones, the country plays a significant role in the supply of solar power equipment. In fact, nine of the 10 biggest panel exporters come from China. With more than 75,000 cases and over 2000 deaths from the Corona Virus, the illness has impacted a number of industries and solar is no exception. Here’s how solar is being affected by this epidemic.
Thank you for reading this post, don't forget to subscribe!What is the Corona Virus?
Coronaviruses are a series of viruses that typically cause disease in animals. In this epidemic the new virus (Covid-19) has affected humans and the likely cause is eating meat from an infected animal. The virus is highly contagious, and the symptoms include a cough, high temperature and shortness of breath. Whilst the coronavirus has spread across the globe it’s impact has been minimal in Africa with only 1 confirmed case to date in Egypt.
How is Corona Virus Affecting Manufacturing?
Solar power manufacturers have been impacted by the virus with Investment banking company Roth Capital Partners stating that “We’ve been told that the ‘not to return to work’ order, i.e. work stoppage, may not be applicable to companies that never dismissed employees. Our guess is that while most of the facilities have been up and running, they likely have not been running at 100% staffing.” In addition, to staffing shortages another challenge faced by solar producers is that transport has been significantly impeded across many regions in China, impacting internal movements of goods and ease of exportation. Therefore, production in China has decreased for the short term and the most affected buyers will be large-scale solar projects whose deadlines will need to be extended.
Could the cost of Solar Power Rise?
Due to short-term lesser production, the price of solar could rise. However, any increase is unlikely to be significant. Historical oversupply in the industry means it is more likely that the passing corona virus will soften any further price dips for the rest of the year. It is also worth noting that whilst China dominates solar power equipment production, other countries in East Asia such as Taiwan are significant producers of solar and an alternative supply for buyers.
The Road To Recovery
It is expected that solar output from China will resume usual production no later than June. In the meantime, consumers are advised to monitor and compare the pricing of their local solar and enquire if there are any shifts in normal delivery timescales.
