CCID Consulting Co., Ltd.

Asia: China`s Photovoltaic Industry Is a Huge Underdeveloped Market


Source: CCID Consulting Co., Ltd.

The global photovoltaic market sustains a high growth momentum.

For the year 2009, the newly-added installed photovoltaic power capacity neared a total of 5,800MW around the world and the global market continued its high-speed growth at a rate of 46.6%. Due to a tight supply of silicon, the production cost of silicon solar cells has been on the rise during the last few years, while thin-film solar cells, including a-Si, µc-Si, CdTe and CIGS, have been increasing their market share with their improved cell conversion efficiency and cost advantage as a result of large-scale production. In terms of newly-added installed capacity, Germany tops the list with a newly-added installed photovoltaic power capacity of 3,000MW, and its market share has risen from 41.1% in 2008 to 51.7% in 2009. This is partly attributable to the slowdown in the Spanish market which enjoyed the fastest growth in 2008. In 2009, Spain reduced subsidies to photovoltaic power generation, resulting in a sharp drop in its newly-added installed photovoltaic power capacity from the previous year's 2,500MW to 60MW.

Chart 1 Newly-Added Installed Photovoltaic Power Capacity and Growth Rate in 2009

2.China's photovoltaic industry is among the world's largest.

In 2009, China's solar cell output reached 3,850MW with an annual growth rate of 93%, which was above the world average.

Chart 2 China's Solar Cell Output, 2005-2009

3.China's photovoltaic enterprises are mostly in the midstream and downstream sectors.

China's solar cell enterprises are mostly in the midstream and downstream sectors of the industry chain, where competition is ever increasing.. By the end of 2008, China had 37 polysilicon plants, 143 silicon bulk/silicon bar plants, 138 silicon wafer plants, 357 solar cell component plants and more than 1,000 solar power product plants. Competition grows as it goes farther to the downstream (featuring solar cell components and solar power products) end, for numerous enterprise have been attracted to the downstream sectors due to their smaller investment, shorter construction cycle, lower requirements for technology and fund and easier marketing.

For the moment, China's solar cell market is dominated by major manufacturers including Wuxi Suntech Power Holdings, China Sunergy, Yingli Solar and Trina Solar, among which Wuxi Suntech Power Holdings has become one of the world's top solar cell manufacturers. These enterprises featuring advanced production technologies, large-scale production capacities and stable product quality have access to adequate raw material supplies and have a strong competitive advantage. In addition, most of them have been listed on domestic and international stock markets, thus they can improve their financing channels to expand production and enhance their products' competitiveness. Among them, Wuxi Suntech and Yingli Solar have also entered the upstream sectors to develop a vertical structure.

4. China's newly-added installed photovoltaic power capacity sees explosive growth.

Boosted by a series of subsidy policies, China's installed photovoltaic power capacity saw an explosive growth in 2009 with a total newly-added installed photovoltaic power capacity of 120MW. The figure equals the country's historical total. Currently, photovoltaic power is mainly applied to communications and industrial fields, rural and remote areas, photovoltaic grid-connected inverter systems and solar power products in China.

Chart 3 China's Solar Cell Installed Capacity, 2005-2009

5.Low cost and low energy consumption are future trends for the development of China's photovoltaic industry.

As to the future trends of the photovoltaic industry, reduction of production cost and energy consumption will be desired in the production of silicon solar cells, and it can be achieved with advancement in the research on the new generation of polysilicon technologies, higher-performance, larger and slimmer silicon wafers as well as technical upgrades towards automation and intellectualization. Besides, next-generation solar cells will come into being along with the development of new materials, new structures and new technologies. Currently, quantum dot solar cells, quantum well solar cells, dye sensitization cells, hot photovoltaic cell and organic thin-film solar cells are emerging for the purpose of reducing production costs and energy consumption and increasing the photoelectric transformation efficiency and the proportion of renewable energy.

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