The Chinese government might decide to ease construction deadlines for wind and solar projects as the coronavirus plays havoc with their plans, said analysts at Azure International as it labelled the outbreak a potential “stab in the wound” for China’s renewable energy sector.
Chinese officials will need to decide whether to give developers “a few months’ slack”, said the specialist energy consultancy, as it added to warnings of supply chain pressures and disruption of the type reported by Recharge last week.
Developers are racing to meet tight project completion deadlines in 2020 and 2021 ahead of expiry of government support arrangements in onshore wind and PV, and offshore wind.
Late returns to work after the new year holidays and travel restrictions will make it “significantly harder” to meet the goals.
The Chinese PV sector has already asked for an easing of grid-connection deadlines in the face of the coronavirus emergency, said Azure, adding that concessions to the renewables industry would be “reasonable and safe” in the current context.
“Many provinces and regions such as Shanghai, Guangdong, Jiangsu, Fujian and Zhejiang where wind power equipment manufacturing and offshore wind power projects are concentrated have further postponed the return to work to after 9 February,” said Azure in a note.
“The extra ten-day holiday coming at the height of the ‘construction rush’ is creating significant challenges for OEM, EPC and C&I companies which are failing to deliver in a timely manner. In addition, the outbreak is more severe in the labor export provinces such as Hubei, Hunan and Henan and has hampered the flow of labour.”
It added: “The offshore wind construction cycle is a highly complex procedure demanding seamless coordination and integration of different steps and actors. Any missing block in the whole cycle will inevitably affect the entire industrial chain and delivery process, and ultimately grid connection of projects.”
Recharge reported last week how global wind giants Orsted and Vestas have imposed travel restrictions on staff because of the virus.