There are three phases of PV industry development, including formation, regional development and globalization, according to Bettina Weiss, VP, Global PV Business Unit, SEMI, USA. She was delivering the opening keynote at the ongoing Solarcon India 2012 event in Bangalore, India. The event runs till September 5.
According to her, in the first stage, discoveries lead to inventions. Inventions find niche and high-value applications. Technology, and not manufacturing is the key driver here. For regional development, new industries seen as source for economic development. Markets develop through government subsidies. Global supply chains and regional clusters of excellence develop as well.
State of global PV industry
The government policy support for PV has been strong till 2011. However, it may fall of during 2012-16. The supply-demand balance was generally stable till 2011, which could likely see structural overcapacity in 2012-16. The demand, which has been over 70 per cent till 2011, will likely see -20 per cent growth from 2012-16.
While there were many ‘saviour’ markets, such as Spain (2008), Italy (2010) and Germany (2009-11), Europe may prove to be not enough to absorb excess capacity in 2012-16. Poly, scale and the learning curve had been competitive till 2011, and are likely to give way to non-poly costs, technology and efficiency during 2015-16. While the gross margin was consistently above 20 per cent till now, the path to profitability remains unclear for the period 2012-16.
As for the cell and module makers performance, sharp price declines since 2011 have stimulated record installations globally. The effect on PV manufacturers have been severe. The entire supply chain has been plagued with collapsing margins.
Revenue to shipment ratio declined for five consecutive quarter since Q1 ’11. The list of insolvencies keeps growing. The outlook for 2012 is that volume/shipment upside is likely, but the path to profitability is still unclear.
Then, there is the ongoing solar trade war!
The US Department of Commerce (DOC) levied anti-dumping tariffs against Chinese solar module imports, with tariffs ranging from 31 per cent to 250 per cent. In response to the US tariffs, China’s Ministry of Commerce, on July 21, 2012, announced that it will start its own AD and CVD investigation on imported solar-grade polysilicon from US, and is initiating an AD investigation on these imports from South Korea. The EU Commission will decide by mid-September whether to accept a similar complaint and launch an investigation.
Globalization, and China!
Now, the third phase is globalization. Since 2007, China has been the world’s top producer of PV cells. China’s cell in PV cell production grew from only 27 per cent in 2007 to over 57 per cent in 2011.
There will likely be PV capacity expansion and the growth of China. In 2011, the global top 20 module suppliers were:
2. First Solar
3. Yingli Green Energy
5. Canadian Solar
8. Tianwei New Energy
9. Hanwha Solar One
10. LDK Solar
11. Hareon Solar
12. JA Solar
13. Jinko Solar
17. Jiawei Solar
19. Changzhou Eging PV
20. Aide Solar
(Those marked in bold are Chinese suppliers).
The International PV Technology Roadmap (ITRPV) has become a major contributor to identifying and focusing the industry on key cost reduction opportunities in c-Si PV. Now in its third edition, there is participation from leading suppliers and manufacturers in US, Asia and Europe. Cost reduction targets have been identified in 18 areas.
PV solar will make a long-term contribution to global energy supply. The market is growing, but overcapacity is impacting financial sustainability. Regional subsidies on demand and supply will decline, and global market forces will dominate. Innovation will continue, as the global collaboration is alive and well in industry standards and roadmaps.