| Date | November 24, 2023 |
|---|
InfoLink’s Solar Analyst Alan Tu (杜加恩) shared insights on the development and prospects of the solar industry with industry experts at the High-Quality Development Forum for the Solar Industry on November 16.
The Russian-Ukraine conflicts and energy issues in Europe led to skyrocketed demand for solar energy in 2023, with an annual growth rate of 45%, pointed out Tu. In 2024, demand will continue rising steadily, but the growth rate will decrease to around 15%.
The three major markets each face different challenges. China is experiencing grid capacity issues due to the rapid growth of installed capacity, which will limit the development of distributed generation projects next year. In Europe, installation is affected by high inventory levels and labor shortages. The U.S.’s actual supply is constrained by human rights issues in Xinjiang. Additionally, the upcoming imposition of anti-circumvention tariffs next year poses uncertainties for manufacturers entering products to the U.S. Whether they can make it across the U.S. border against these backdrops requires further observation.
After a year of “tight balance” across the supply chain in 2022, polysilicon and wafer production output has surged in 2023, resulting in supply gluts. In the second half of this year, module prices plunged, reaching RMB 1/W for the moment, affecting gross margins of upstream and downstream sectors. In 2024, as the industry keeps expanding production, widening the gap between supply and end-user demand, there will be even severer oversupplies, affecting gross margins and future price trends.
Meantime, cell technology transition is underway as the world places increasing emphasis on cell efficiency, but p-type technology has reached its limit.
According to Tu, among the three mainstream technologies of high-efficiency cells, TOPCon has a planned capacity exceeding 1,700 GW, with more than 600 GW beginning to come online this year. The planned capacity of HJT reaches 391 GW, with 50 GW set to commence production. Back Contact (BC) has a planned capacity of 159 GW, with 44 GW expected to be operational.
With a superior price-performance ratio, TOPCon is more likely to enter mass production. As production capacity rapidly increases, TOPCon will take up the largest market share next year, becoming the new dominating technology succeeding PERC.
Manufacturers with higher ratios of PERC cell production capacity will face challenges in dealing with these outdated capacities in 2024 amid serious oversupply and technology iteration, said Tu.
Tu expects the future to focus on cost reduction and efficiency improvement despite the industry-wide oversupply and ceaseless module price declines. Module prices are no longer the only factor affecting end users’ choices. Better power output, reliability, and quality assurance provided by reputable module makers will be equally important.
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The Russian-Ukraine conflicts and energy issues in Europe led to skyrocketed demand for solar energy in 2023, with an annual growth rate of 45%, pointed out Tu. In 2024, demand will continue rising steadily, but the growth rate will decrease to around 15%.
The three major markets each face different challenges. China is experiencing grid capacity issues due to the rapid growth of installed capacity, which will limit the development of distributed generation projects next year. In Europe, installation is affected by high inventory levels and labor shortages. The U.S.’s actual supply is constrained by human rights issues in Xinjiang. Additionally, the upcoming imposition of anti-circumvention tariffs next year poses uncertainties for manufacturers entering products to the U.S. Whether they can make it across the U.S. border against these backdrops requires further observation.
After a year of “tight balance” across the supply chain in 2022, polysilicon and wafer production output has surged in 2023, resulting in supply gluts. In the second half of this year, module prices plunged, reaching RMB 1/W for the moment, affecting gross margins of upstream and downstream sectors. In 2024, as the industry keeps expanding production, widening the gap between supply and end-user demand, there will be even severer oversupplies, affecting gross margins and future price trends.
Meantime, cell technology transition is underway as the world places increasing emphasis on cell efficiency, but p-type technology has reached its limit.
According to Tu, among the three mainstream technologies of high-efficiency cells, TOPCon has a planned capacity exceeding 1,700 GW, with more than 600 GW beginning to come online this year. The planned capacity of HJT reaches 391 GW, with 50 GW set to commence production. Back Contact (BC) has a planned capacity of 159 GW, with 44 GW expected to be operational.
With a superior price-performance ratio, TOPCon is more likely to enter mass production. As production capacity rapidly increases, TOPCon will take up the largest market share next year, becoming the new dominating technology succeeding PERC.
Manufacturers with higher ratios of PERC cell production capacity will face challenges in dealing with these outdated capacities in 2024 amid serious oversupply and technology iteration, said Tu.
Tu expects the future to focus on cost reduction and efficiency improvement despite the industry-wide oversupply and ceaseless module price declines. Module prices are no longer the only factor affecting end users’ choices. Better power output, reliability, and quality assurance provided by reputable module makers will be equally important.
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