Yingli Energizes Malaysia's Largest Solar Plant - Analyst Blog

Yingli Green Energy Holding Company Ltd. YGE announced that its solar modules were used to build the largest solar power plant in Malaysia. The deal was done through its business wing, Yingli Green Energy Singapore Company Pte. Ltd. The project undertaken by Amcorp Power Sdn. Bhd is situated in the Gemas, Negri Sembilan region of Malaysia. The market reacted positively to the news with Yingli Green's share price surging 8.20% to close at $3.30.

The plant is fitted with over 10 megawatts MW of Yingli Solar's photovoltaic (PV) modules. The joint venture between Yingli and Amcorp was signed back in Mar 2013 with the project being commissioned in June. The deal involved Yingli Solar delivering its 60 Cell Series solar panels for the 10.3 MW solar power plant.

The complex is spread across an area of roughly 34 acres and is equipped with over 40,000 of Yingli Solar's multicrystalline modules which will produce nearly 13.6 million kilowatt-hour of clean power per annum. In addition to supplying PV modules, the company also offered after-sales support to the project.

Yingli Solar is set to be a prominent player in the emerging renewable market worldwide.The solar PV market in China is rapidly evolving as favorable policy environment aims to meet the growing energy needs from green sources. In 2013, China added an astounding 12 gigawatts (GW) of solar capacity, up from 3 GWs in 2012.  

Japan is also not far behind. The country's PV market recorded 60% year-over-year growth in volume in the final quarter of fiscal 2013 with relatively steady imports. With solar PV projects of over 20 GW in the pipeline, Japan is anticipated to be the second to dominate the global PV industry after China in Asia.

Yingli Solar's emphasis on offering cutting-edge solar manufacturing products to its customers will act as a tailwind. Yingli Solar recently announced trial production of its M-SI modules known as N-type Metal-Wrap-Through, or "N-MWT," technology, which might offer a competitive edge over other solar operators. The N-MWT boasts of diminishing power loss in the panel encapsulation process and boost cell efficiency.

Meanwhile, a strong year lies ahead for the global renewable market as solar consumption is likely to increase by 36% in 2014 as per Solar Tribune report. Yingli Solar is expected to capitalize on this bullish solar market conditions by shipping 4 Gigawatts of PV in 2014, exceeding 2013 levels by 33%.

However, the ongoing solar tariff wars between the U.S. and China might pose challenge for the company as America is one of its prime customers. Currently, Yingli Solar carries a Zacks Rank #3 (Hold).

Other better-placed renewable operators include Zacks Ranked #1 (Strong Buy) JA Solar Holdings Co., Ltd. JASO and Covanta Holding Corporation CVA. Investors may also consider Zacks Ranked #2 (Buy) First Solar, Inc. FSLR.