According to a recent report by Wood Mackenzie, titled “How will China’s market expansion affect the global PV module supply chain?” After investing more than $130 billion in the PV industry in 2023, China will have more than 80% of the global manufacturing capacity for polysilicon, silicon wafers, photovoltaic cells and photovoltaic modules between 2023 and 2026.
Huaiyan Sun, study author and Senior Consultant at Wood Mackenzie, said: “While the expansion of China’s PV manufacturing industry has been affected by lower polysilicon prices, technology upgrades and the development of local manufacturing in overseas markets, China will still dominate the global PV supply chain (Modules,Inverter, Solar Mounting System,etc) and continue to widen the technology and cost gap with its competitors.”
According to Wood Mackenzie’s forecast for annual market demand growth, by 2024, China is expected to produce more than 1TW of silicon wafers, photovoltaic cells and photovoltaic modules, meaning that China has enough capacity to meet annual global demand from now until 2032.
China’s capacity expansion will continue its dominant position in the global PV industry with its advanced technology, low cost and complete supply chain
The introduction of strong policies in overseas markets has begun to strengthen the local Pv Generation System manufacturing industry, but there is still no cost competitiveness compared with the photovoltaic systems products supplied by China. According to the study, Chinese-made PV modules are 50% cheaper than those made in Europe and 65% cheaper than those made in the United States.
Since 2022, driven by the US Inflation Reduction Act (IRA) and India’s Production Linked Incentive Act (PLI), the US and India have announced planned PV module capacity of more than 200GW.
Huaiyan Sun said: “Although there are considerable expansion plans for PV modules in the overseas market, the overseas market is still unable to eliminate its dependence on silicon wafers and PV cells from China in the next three years.”
N-type photovoltaic cells are the next generation technology after P-type photovoltaic cells. The N-type photovoltaic cells planned to be manufactured in China will reach more than 1TW, and will continue to maintain a leading position in global technology. This means that China’s N-type photovoltaic cell production is 17 times that of the rest of the world.
Looking beyond China, India is expected to overtake Southeast Asia to become the second largest PV module production region by 2025, mainly driven by India’s Production-Linked Incentive Act incentives.
Oversupply and fierce competition will characterize the future supply chain of photovoltaic products and have already led to the cancellation of some expansion plans
Post time: Nov-07-2023