context: Since the era of grid parity started in 2021, with subsidies gradually phasing out, companies in both solar photovoltaics and wind power have engaged in cut throat competition, often resorting to low pricing strategies, leading to an involution trend within the sector. Qin Haiyan 秦海岩 Chinese Wind Energy Association secretary-general notes that bidding prices for wind turbines are often lower than the direct material costs, resulting in widespread losses for the manufacturing side of the industry.
Qin Haiyan 秦海岩 Chinese Wind Energy Association secretary-general again warned that the ongoing price war is undermining the foundation of the wind power industry at the 2024 Beijing International Wind Energy Conference and Exhibition on 16 October.
This situation, he notes, not only hinders the high-quality development of wind power projects but also threatens the survival of manufacturers, ultimately restricting the industry’s sustainable growth.
Since last year, no leading manufacturer has been profitable in manufacturing, says Liu Lianyu 刘连玉 Mingyang Group president. He stresses that such competition harms not only the wind power and manufacturing sectors but also the broader power sector’s development, especially future power plant projects.
In response to these challenges and to create a fairer and more sustainable competitive environment, 12 major domestic wind turbine manufacturers signed the China Wind Power Industry Fair Competition Self-Regulation Convention.
The agreement focuses on issues such as unfair price competition, malicious slander and inequitable contract terms. The signatories are prohibited from selling products or services below cost without a valid reason. They are also encouraged to reject unfair contracts, avoid unrealistic promises and refrain from disparaging competitors to gain market advantage.
Participation is voluntary, with companies agreeing to comply with its terms upon joining. The Convention outlines measures such as
- avoiding price collusion
- promoting self-regulation in pricing
- using legal methods to enhance enforcement
- establishing clear and actionable rules to prevent empty slogans
Singatories include Goldwind, Envision Energy, Windey, Mingyang Smart Energy, SANY Heavy Energy, Dongfang Electric, Shanghai Electric Wind Power, CRRC Zhuzhou Institute, CSSC Haizhuang, United Power, Sinovel and Xinglan Wind Power.