What is the development prospect of the photovoltaic industry in the next 5 years?

Industry's main listed companies:Domestic PV industry listed companies are mainly LONGi shares (601012), gold high-tech (002459), JinkoSolar (688223), Tongwei shares (600438), Trina Solar (688599) and so on.

The core data of this article: capacity utilization, installed capacity, abandoned light rate, photovoltaic power generation, system construction costs.

Industry Overview

1. Definition

Photovoltaic industry, referred to as PV (photovoltaic), mainly refers to the development of silicon material applications to form the photovoltaic conversion industry chain, including the production of raw materials of high-purity polysilicon, solar cell production, solar cell module production, manufacturing of related production equipment and photovoltaic power generation applications. With the advancement of the national goal of peak carbon neutral carbon dioxide emissions, the construction of a new power system with new energy as the main body is being accelerated. PV, together with the Fuxing high-speed railroad, domestic commercial aircraft, and a new generation of launch vehicles, has been awarded the commemorative stamps of the 19th National Congress of the People's Republic of China***. Photovoltaic industry status is significantly enhanced, ushering in historic development opportunities.

The downstream application of photovoltaic industry is mainly photovoltaic power generation, which can be divided into centralized photovoltaic power generation system and distributed photovoltaic power generation system according to the construction planning and positioning. Centralized photovoltaic power generation system, such as large-scale northwest ground photovoltaic power generation system; distributed photovoltaic power generation system (to > 6MW as the boundary), such as industrial and commercial enterprises and residential buildings roof photovoltaic power generation system.

2. Industry chain analysis:Long industry chain.

With photovoltaic power generation playing an increasingly important role in the energy supply system, the photovoltaic-related industries are also growing, forming a complete industrial chain from high-purity silicon materials, ingots/bars/sheets, batteries/modules, PV auxiliary materials and accessories, PV production equipment to the PV product system integration and application.

The upstream of the PV industry chain is mainly the raw materials related to PV cells, including monocrystalline silicon and polycrystalline silicon, which constitute the cells. The upstream monocrystalline and polycrystalline silicon producers are mainly GCL-Poly, LONGi, TONGWEI, and Zhonghuan. However, silicon wafer producers have shown a duo-oligarchic pattern, with Chinese solar wafers taking up most of the global market share. In the Chinese market, the mainstream manufacturers are mainly LONGi and Azeus, and the capacity pattern is still highly concentrated. In terms of the scale of external sales of silicon wafers, Azeus and LONGi occupy the absolute leading position.

Midstream are mainly battery chip and module manufacturers as well as system integration enterprises. The midstream manufacturers of battery chips and modules mainly include Tongwei, LONGi and JAO. Inverter manufacturers in the photovoltaic power generation system are mainly Sunny Power and other companies; system integration, including Yijing photovoltaic, Astronergy and so on. Some enterprises, such as LONGi, have basically formed a complete PV power generation industry chain from monocrystalline silicon to modules to power station PV operation. It is the downstream PV power generation application field, including distributed PV power generation and centralized power station.

Industry development process:The industry is in a rapid development stage.

Driven by the demand of the European market, China's photovoltaic industry started from around 2005. Over the past ten years, it has realized a leapfrog development and established a complete market environment and supporting environment. It has become one of the few strategic emerging industries in China that can participate in international competition and reach the international leading level. It has also become a brand-new business card for China's industrial economic development and an important engine for promoting China's energy reform. At present, China's photovoltaic industry ranks among the world's frontrunners in terms of manufacturing scale, industrialization technology level, application market expansion and industrial system construction, etc., and has a solid foundation of intelligent photovoltaic. China's photovoltaic industry has experienced the following historical stages:

Industry background: policy support, photovoltaic industry to accelerate the development of

China since January 1, 2006, the implementation of the "People's Republic of China *** and the State Renewable Energy Law". The law will be the development and utilization of renewable energy as a priority area of energy development, and promote the increase in energy supply, improve energy structure, energy security, environmental protection, sustainable economic and social development, the establishment and development of renewable energy market. Since 2006, in order to encourage and support the development of the photovoltaic industry, the National Development and Reform Commission, the Ministry of Finance, the Ministry of Industry and Information Technology, the National Energy Administration, the Ministry of Housing and Construction and other departments intensively issued policy documents to support and regulate the development of the photovoltaic industry, covering production, sales, finance and taxation, subsidies, land policy and other relevant aspects of industrial development.

The Ministry of Industry and Information Technology (MIIT), the Ministry of Housing and Urban-Rural Development (MOHURD), the Ministry of Transportation (MOT), the Ministry of Agriculture and Rural Development (MARD), and the National Energy Administration (NEA) have jointly issued the "Action Plan for the Innovative Development of the Intelligent Photovoltaic Industry (2021-2025)," which is aimed at effectively guiding the industry to upgrade its intelligence and promoting the healthy development of the photovoltaic industry during the Tenth Five-Year Plan period. In order to promote the large-scale application of photovoltaic power generation, to maintain China as the world's photovoltaic manufacturing and installed power application of the first country's position.

"Peak carbon neutral by 3060" is a systematic economic and social change with multiple goals and constraints. Reshaping China's economic structure, energy structure, and changing production methods and lifestyles is a historic breakthrough that requires dealing with multi-dimensional relationships such as development and emission reduction, carbon reduction and security, overall and local, short-term and medium-term, establishment and disruption, government and market, domestic and international. The goal of "peak carbon dioxide emissions, carbon neutral" will have a significant multi-dimensional impact on China's photovoltaic industry.

Industry development situation

1. PV products market supply capacity is strong, capacity utilization rate needs to be improved.

According to the PV industry market key company PV product output and capacity utilization rate, in 2021 China PV product market supply capacity is stronger, LONGi Green Energy PV product output is far ahead of other companies, monocrystalline silicon wafer output reached 69.96GW, monocrystalline module output reached 38.69GW, from the capacity utilization rate, in 2021 PV market company capacity utilization rate is not high , there is still more room for improvement.

2. PV new installed capacity hit a new high, the cumulative installed capacity of more than 300 GW.

China's solar PV industry, although a late start, but rapid development. Especially since 2013, driven by national and regional policies, solar PV power generation has shown explosive growth in China. According to the National Energy Board statistics, in 2017, China's PV power generation new installed capacity of 53.06GW, a record high.In 2018, affected by the PV 531 new policy, new PV power generation projects around the world declined, and the new installed capacity for the whole year is affected by the national PV industry subsidies, financial support and other policies, and the PV installed capacity in 2020 and 2021 has risen sharply.In 2020, the installed capacity of China's photovoltaic power generation increased by 48.20GW, a year-on-year increase of 59%. 2021, China's new PV installed capacity hit a new high of 54.88GW, a year-on-year increase of 14%.

According to the National Energy Administration (NEA), China's cumulative installed capacity of PV power generation has grown rapidly since 2013.In 2013, China's cumulative installed capacity of PV power generation was only 19.42GW, and by 2019 it had grown to 204.58GW.Between 2013 and 2019, China's cumulative installed capacity of PV power generation has grown by more than 10 times. By 2021, the country's cumulative installed capacity of photovoltaic power generation will be 306.56GW, a year-on-year increase of 21%.

3. The PV abandoned light rate has decreased significantly, and PV power generation has grown steadily.

With the rapid development of PV power generation, there are also serious problems of light abandonment in some places. Data from the National Energy Administration shows that in 2015-2018, the highest light abandonment rate in Xinjiang and Gansu exceeded 30%. 2019-2021, the light abandonment rate in Xinjiang and Gansu decreased significantly, with the light abandonment rate in Xinjiang falling to 1.7% in 2021, and in Gansu to 1.5%. The significant drop in the light abandonment rate is mainly due to the grid-connected operation of PV power generation, which promotes the level of resource utilization.

According to the National Energy Administration, since 2013, China's PV power generation has been growing rapidly. 2013 national PV power generation was only 9.1 billion kilowatt hours. By 2021, the national photovoltaic power generation capacity of 325.9 billion kilowatt-hours, a year-on-year increase of 25%. It is expected that in 2021, China's photovoltaic power generation will account for 3.92% of the whole society's electricity consumption.

4. The construction cost of PV power generation system is on a downward trend, and the PV Internet access has entered the parity price.

China's total initial investment in ground-mounted PV systems mainly consists of key equipment costs such as components, inverters, stents, cables, primary and secondary equipment, as well as land costs, grid access, construction and installation and management costs. Among them, primary equipment includes equipment such as box transformers, main transformers, switchgear, and booster stations (50MW, 110kV), and secondary equipment includes monitoring and communication equipment. Land costs include full life-cycle ground rent, vegetation restoration fees or related compensation fees; access costs to the grid include only 50MW, 110kV, and 10km reverse transformation; and management costs include pre-management, surveying, design, and bidding. Construction and installation costs are mainly labor costs, earthwork costs, and conventional reinforced concrete costs. , and there is little room for future decline. With technological progress and economies of scale, the cost of key equipment such as components and inverters still has some room for decline. Network connection, land, pre-project development costs, etc.. are all non-technical costs that vary greatly from region to region and project to project. Reducing non-technical costs will help accelerate the promotion of PV power generation with low grid access prices.

The total initial investment cost of China's ground-mounted PV system in 2021 will be about 4.15 yuan/w, up 0.16 yuan/w from 2020, an increase of 4%. Among them, modules account for about 46% of the investment cost, up 7% from 2020. Non-technology costs account for about 14.1% (excluding financing costs), down 3.2 percentage points from 2020. It is expected that in 2022, with the gradual release of new production capacity in all segments of the industrial chain, component prices will return to a reasonable level, and the total initial investment cost of the PV system will drop to $3.93/w.

The total initial investment in China's industrial and commercial distributed PV system is mainly composed of components, inverters, stents, cables, installation costs, grid connection, roof leasing, roof reinforcement, primary equipment and secondary equipment. Primary equipment includes box-type transformers, switch boxes and prefabricated cabins. According to China's PV industry development roadmap, the initial investment cost of China's industrial and commercial distributed PV systems will be RMB 3.38/W and RMB 3.74/W in 2020 and 2021, respectively, and is expected to drop to RMB 3.53/W in 2022.

China's PV feed-in tariffs subsidy policy to end in 2020, with parity approaching:China's feed-in tariffs policy has gone through benchmark tariffs At the same time, 2020 will also be the PV grid parity year, parity project 33GW, an increase of 124%, for the first time more than the bidding project size. Parity will come, 2021 will be the first year of China's PV grid parity.