Canadian Solar mulls 700MW factory in China

Canadian Solar Inc. has revealed that it will come up with a decision in the coming months whether to build a factory in China. The planned facility is expected to produce 700MW per year of new, more efficient solar cells, the firm's CEO indicated.

CEO Shawn Qu said there was a good chance the company, which already carries out most of its production in China, would take the step despite oversupply in the solar equipment market. He declined to comment on the potential cost.

Solar equipment manufacturers have struggled to reduce production costs as prices for panels that convert sunlight into electricity have dropped by more than half in the past year on a supply glut.

That has forced several companies in China, Europe and the U.S. to shutter operations, and many more are expected to merge or shut down as the fledgling industry undergoes a shakeout.

The factory touted by Canadian Solar would produce cells that the Ontario-based firm said can achieve efficiency of 19.5 percent, compared with about 17 percent for many rivals.

Mark Kingsley, chief commercial officer of China-based competitor Trina Solar Ltd , said he expected to see solar companies start competing more on efficiency and less on price, as costs have come down far enough for most buyers.