March 11, 2016   Posted by: Wouter Vermeersch

Cleantec Trade: 5 years!

5 jaarCleantec Trade BVBA was established on March 11, 2011 and is thus five years. Day by day, almost symbolically, the terrible nuclear disaster of Fukushima also occurred. This disaster sent a shock wave through the world and fuelled the debate on renewable energy.

The European solar market declined since its peak of 2011 (22.4 GWp) by as much as 36% in 2015 (8 GWp); nevertheless Cleantec Trade managed to grow. An overview of an eventful, but wonderful, history with the key market trends of the past 5 years:

2011

Cleantec Trade was founded in the year that most European governments decided on a significant reduction in the subsidies for solar panels. In addition, there was an oversupply of solar panels, resulting in a strong decline of prices. Some international producers and European installers could not withstand the pressure and went bankrupt.

By pooling volumes of its customers, the excellent contacts and partnerships with producers and a cost-efficient organisation, Cleantec Trade could offer sharp conditions for several A-brands of solar panels. Initially Cleantec Trade specialized in the sales of Chinese crystalline modules per full container loads. Brands such as Sunrise Solartech, Canadian Solar, China Sunergy (CSUN) and Yingli Solar took an important place in the initial product portfolio.

2012

The continuing decline in solar panel prices experienced a new acceleration during the summer of 2012. Oversupply was the dominant cause, but prices were also influenced by other factors such as a sharp decline in demand for new shipments from China and the high stock levels of Chinese producers in European ports.

As a result of continued strong declines in the prices of crystalline panels and unattractive subsidies for large-scale PV systems, the promising thin film technology lost its importance. The thin film technology has therefore to date not many representatives left. Already two major bankruptcy waves have plagued the technology.

To further meet the needs of its customers in a contracted market, Cleantec Trade also began selling solar panels per full pallet. Many installers and distributors sold significantly smaller volumes of solar panels. The brands LDK and Build Your Dreams (BYD), were added in large volumes to the existing product range.

2013

In the first half of 2013, prices of Chinese solar panels began to rise again because of the anti-dumping and anti-subsidy investigations of the European Commission. Cleantec Trade stood at the cradle of AFASE (Alliance for Affordable Solar Energy), a coalition of solar companies who see free trade as the basis for a healthy and competitive PV market. The trigger for these EU investigations a claim by “EU ProSun” (the lobby group around SolarWorld) and led to the registration of all imports from China at risk of retroactive duties from March ’13, a provisional import duty of 11,8% from June ’13 and eventually the minimum import price (MIP) of 0,56 €/Wp from August ’13.

The prices of Chinese solar panels were levelled by the price undertaking between Europe and China. The MIP for Chinese modules was mainly competitive for solar panels with an added value such as ‘full Black’ panels and panels with high efficiency. For standard poly modules this price was generally considered as being too high. Cheaper alternatives for standard panels became available in other Asian countries. However, the market rumours on infringements of EU-CN price agreement became stronger and stronger: transhipment through third countries, relabeling and refunds through shadowy structures were common forms of fraud.

The price equality of Chinese solar panels enabled Cleantec Trade to keep several Tier-1 brands (top brands) in stock: JA Solar and ReneSola. A full-fledged warehouse was built out in the port of Rotterdam (Bergschenhoek) to meet the increased demand from the Netherlands.

2014

During this special year, the market was shaken in various ways. Germany gave for the first time the leading position in the European market to the United Kingdom, the minimum import price was adjusted downwards repeatedly and European demand for solar panels collapsed by additional heavy reductions in subsidies from Germany, Italy, Greece and Romania and the disastrous impact of the import duties. In addition, from February ’14 the recycling of solar panels became gradually compulsory in all EU Member States under the influence of the European Directive on Waste Electrical and Electronic Equipment (WEEE).

Cleantec Trade set up a strategic distribution partnership with the brands Trina Solar (China) and Neo Solar Power (Taiwan). Trina Solar became in the same year the world’s largest producer instead of Yingli and was alone responsible for 8% of global production. In August ’14, the ‘School of the Future’ put into service a new PV installation of Cleantec Trade in combination with a battery storage system. It was a pilot project, the first time that such a setup was installed in the Benelux.

2015

Influenced by the sharp fall of the euro against the dollar, the EU Commission decided to increase the MIP as from the second quarter ’15.

As the prices of most, Asian or European, brands are situated around the MIP, both Chinese and non-Chinese prices increased on average with 0,04 €/Wp.

Customs authorities in different European member states reported to have started a number of investigations on the circumvention of import duties upon the import of solar panels from China: stocks were blocked and major fines were imposed. Canadian Solar, ET Solar and ReneSola were withdrawn from the price undertaking by the EU Commission. In practice, this implied on the one hand that the import of these brands from China was no longer economically viable (taxed at 47,6%), but on the other hand also that the import of these solar modules with non-Chinese origin from production facilities outside China is completely free of tariffs. Many brands followed the same path and left – voluntarily or not – the price undertaking: ZNShine, Chint Solar, Suntellite and especially Trina Solar. In late December ’15, the EU Commission decided, despite the contraction in the sector and many job losses, to extend the import duties until March, 2017.

In 2015, Cleantec Trade started with the import of poly panels of CSUN from the production plant in Turkey and the import of high-performance black mono panel of Eging PV from China. Eging PV was also included in the Bloomberg list of Tier-1 brands at the end of 2015.

Future

At the beginning of 2016, it is clear that the turbulence in the European solar market is still a long way short of ceasing. Although government intervention on the demand side (subsidizing solar panels) has gradually disappeared from the market, government intervention on the supply side (import duties) continues to rage. With a few pen strokes the European Commission changes import possibilities almost every quarter. A handful of unprofitable European producers, under the common denominator “EU ProSun”, take the solar sector in Europe hostage with the cooperation of the EU bureaucracy in Brussels. But trade barriers always get a trade solution as response by the creative entrepreneurial spirit and cooperation of solar companies in Asia and Europe. Hit hard by the steep import duties imposed by the US and the EU and coupled with rising labour costs in coastal cities, major Chinese producers are expanding their manufacturing bases to other countries like Thailand, Vietnam, South-Korea, Turkey, etc.

The solar market in Europe is at a turning point: the old structures and distribution models are no longer viable. Cleantec Trade, through its lean, efficient and innovative business model, want to respond to the rapid developments in this tumultuous market and provide its customers with the highest quality brands of solar panels brands at the best price.

Cleantec trade expected in 2016 to further expand its product range with solar panels from South-East Asia. In addition, a second warehouse will be opened in Belgium to answer the revival of local demand.

In particular, we want to thank our, for many years, loyal customers, but also our new customers, for their confidence in our company. We look forward to continue to provide you the best that is available in the international solar market.

Yours faithfully,

Wouter Vermeersch
Founder and Managing Director