Technological innovations hs been changing the PV industry, resulting in inevitable consolidation that will see 50% of its supply chain makers globally forced out of market in five years, according to Li Zhengquo, president for the largest China-based solar-grade mono-Si supplier LONGi Green Energy Technology (formerly Xi'an LONGi Silicon Materials).
Technological innovation has negatively impacted PV makers with relatively old production equipment, Li said. For example, polysilicon equipment with annual production capacity of 10,000 tons entailed investment of CNY10 billion (US$1.5 billion) in 2006-2007, but now such equipment with the same capacity costs only CNY1 billion. Therefore existing makers with old equipment are under strong challenges from newcomers, Li noted.
Solar cell equipment installed by China-based makers during their capacity expansion in China and in Southeast Asia in 2015-2017 is also an example of the impact from technological innovation. Li noted China-based solar-grade poly-Si wafers makers are replacing slurry slicing process with diamond wire cut to increase output, and makers still using slurry slicing are much less competitive, Li indicated.
For PV module vendors/makers and undertakers of PV power generation projects, competitiveness in power generation reflected in cost per kWh of generated electricity rather than brand reputation and sales channels is key to their survival, Li indicated.
As China-based makers will ramp up production at new facilities in 2018, solar-grade mono-Si wafers will be short of demand and increasingly competitive in price along with decreasing production cost, Li noted. China-based solar-grade mono-Si wafer makers' combined annual production capacity will increase from 17GWp in early 2017 to 65GWp at the end of 2018.
The development of the PV industry is not mature yet and still needs to work towards achieving grid parity, independence of government feed-in tariff subsidization and wider use of PV power around the world, Li indicated.
