GCL System Integration Technology Co. plans to build the world’s biggest solar-panel manufacturing plant, with capacity to meet half of global demand.
The Chinese manufacturer plans to invest 18 billion yuan ($2.54 billion) to construct a facility in eastern Hefei province that will be able to produce 60 gigawatts of solar panels a year, GCL System said in afilingto the Shenzhen stock exchange on March 27. It didn’t provide a timeline.
The plant’s maximum output is double the 30 gigawatts of capacity installed in China in2019, andwould be able to supply to almost 51per centof solar installations worldwide. The project will boost GCL System’s ability to produce panels more than nine-fold from 7.2 gigawatts, according to data fromBloombergNEF. The world’s biggest solar-panel maker,JinkoSolarHoldingCo,.has 16 gigawatts of capacity.
Shares of GCL System fell as much as 6.3 per cent Monday before paring losses to close 1.5per centlower at 3.28 yuan, the lowest since April 2014.
Chinese solar manufactures haveannouncedexpansion plans in recent months amid a push to grab greater market share and reduce costs, which analysts saycould signal more pain ahead for the industry.
GCL System said it will spend 5 billion yuan on the first phase of the project, for 15 gigawatts of production capacity. Another three phases will be implemented later, with the timing based on sales and utilization of the facility, it said.
The company said it wants to seize opportunities that are emerging with solar-power costs now closer to coal power and meet demand for the new type of larger photovoltaic panels. GCL System will use its own funds and loans to finance the investment, it said.
GCL System has a market value of 16.7 billionyuan, andhad 4.03 billion yuan of cash as of the end of the third quarter last year.
© 2020 Bloomberg L.P.