ONEX 18650

China's PV Cell Exports Surge

--- Orders from local companies are saturated, and foreign giants are replaced by Chinese teams


The article is translated from the ” -China Business Network “.

As a senior player on the photovoltaic new energy product track, this year MUST has ushered in the biggest outbreak of orders in recent years.

“Our orders this year have increased by 60% year-on-year. During the epidemic, the growth was still maintained, but this year is especially evident.” Zhong Xuefen, assistant to the president of the Marketing Center of Mercer (Guangdong) New Energy Technology Co., Ltd. told Yicai, from the end of February this year to the present, the production capacity has been increasing, especially in the first half of the year. And it is in a state of “always rushing to work and always saturated with orders”.

Such a state is more like “normal” in the new energy battery industry. According to customs statistics, in the first 10 months of this year, China’s export of mechanical and electrical products was 11.25 trillion yuan, a year-on-year increase of 9.6%. Among which, exports of lithium batteries and solar cells increased by 87.1% and 78.6% respectively.

Under the rapid growth trend, more and more new and old competitors are stepping up their horsepower and seizing business opportunities.

Enterprise investment, transformation and overweight

Young competitors for PV Cell Export

Founded in 2018, Shenzhen Litai Energy Technology Co., Ltd. is a young competitor in the new energy battery track, and mainly produces household energy storage products. Liu Ting, general manager of the company, told Yicai that their export growth rate this year is as high as 220%. In 2021, the growth rate is 150%. “This year’s growth rate is higher than in previous years.”

Although this year is only the fourth year, the company has achieved sales of 140 million yuan, and the team of 45 people has also achieved a high per capita output value. Liu Ting said that the factory is currently fully saturated, and the current two-story factory will be expanded into an independent industrial park next year to maintain rapid growth.

Old competitors for PV Cell Export

“Our factory has been expanded by 30% this year, and we are also accelerating the transformation of automation and digitalization. Otherwise, it will be difficult to undertake the order demand that has been growing rapidly.” Zhong Xuefen said that they have already made preparations for next year. Orders that have always been saturated, along with the introduction of fully automated equipment in 2023 and the expansion of production capacity and digital transformation from this year, will usher in a larger increase next year, “the production capacity is expected to increase by 50%.”

At present, MUST’s annual export volume is over 400 million yuan. And its photovoltaic energy storage products are exported to more than 150 countries and regions, becoming a hot-selling brand in Africa, the Middle East, South America and other regions. With the sales team in Shenzhen and the factory in Foshan, they have achieved a compound revenue growth rate of more than 50% every year in the past three years. The plant area has been expanded to 22,000 square meters, and the current annual output has reached 600,000 units.

In recent years, having been engaged in the energy industry for 24 years, MUST has made major adjustments to its business and product structure along with changes in the market.

Zhong Xuefen said that when the company was first established in 1998, they mainly made UPS (uninterruptible power supply). When the domestic market was saturated and more and more small and medium-sized enterprises joined the competition, they saw a considerable home photovoltaic energy storage market in the global market. So since 2013, they having been producing inverters and controllers related to photovoltaics. In the past three years, they have greatly increased the production of lithium batteries, inverters and energy storage products. What’s more, they have also seized business opportunities with accurate predictions.

China's market of PV Cell

In the face of the surging market demand, new and old competitors are constantly pouring in, and the industry is booming. While local small and medium-sized enterprises are accelerating their expansion and transformation, the upstream foreign giants in China are also accelerating their localization.

In September this year, all management teams of German technology group Heraeus Photovoltaics were replaced with Chinese faces. As the only Chinese face in the group’s over ten global business units, Gao Changlu, president of Heraeus Photovoltaics, said in an exclusive interview with China Business News on November 9 that the signal he released when he took office was very clear. That is, Heli, the company attaches great importance to the Chinese market and has strong confidence in the long-term development of the photovoltaic industry.

Gao Changlu pointed out that the main market and supply chain of the photovoltaic industry are in China. As an industrial enterprise in the upper reaches of the photovoltaic industry, 80% of Heraeus Photovoltaic’s customers and business volume are in China. And the biggest advantage of localization is that it is close enough to customers and the market, that it can reach an agreement with customers on business cognition and decision-making, and timely match the needs of the market. Of course, the photovoltaic products ultimately produced by the Chinese supply chain will be supplied to both domestic and international markets.

Will the PV Cell market continue to explode?

For China’s SMEs, the immediate business opportunities are certain.

China's PV Cell Exports Surge

Liu Ting said, the following 3 reasons have given birth to the rapid growth of the export market of new energy and household energy storage, and will continue to maintain rapid growth for at least the next 3 to 5 years.

  • the energy crisis in Europe and the high electricity prices in Europe and the United States.
  • the “dual carbon” strategy in the global context.
  • the long-term power shortage challenges in South Africa and the Middle East.

MUST President Wu Changhua believes that both the photovoltaic and home energy storage markets will continue to grow in the next 10 years. Changes in the world’s energy pattern and the shortage of electricity in some countries and regions cannot be completed or resolved in a short time. The risks of energy crisis and electricity shortage actually exist for a long time, and they are also deep-seated challenges.

According to the Alibaba Cross-border Index, the main driving force for household energy storage demand in the near and medium term is the increase in household photovoltaic penetration rate and household photovoltaic power in developed regions, as well as the simultaneous increase in the penetration rate of photovoltaic storage integration. At the same time, the power infrastructure is relatively weak, and the household energy storage market in emerging markets such as South Africa and Brazil is also emerging. In the medium long term, the key to the growth of household energy storage lies in the continuous reduction of the cost of household solar energy storage systems. Thereby promoting household solar energy storage systems to become an affordable green power option for residents in wider areas.

From the perspective of the larger photovoltaic industry, Gao Changlu believes that although it will be affected by the short-term impact of changes in supply and demand, the photovoltaic industry as a whole is in a stage of healthy competition, and the market demand in China and even the world will keep growing for a long time. “At present, the cost advantage of photovoltaic power generation has surpassed some traditional energy sources, and the proportion of solar power generation will continue to rise in the future.” Such a trend will undoubtedly drive the growth of energy storage demand.

According to a report by Guosen Securities, according to the International Renewable Energy Agency (IRENA), the total installed capacity of global renewable energy in 2021 has reached 3,064GW (excluding pumping and storage), a year-on-year increase of 9.1%. Solar and wind continued to dominate new capacity additions, with the two technologies together accounting for 88% of all new renewable generation, with solar increasing 19% year over year and wind increasing 13%. In the past 10 years, the global installed capacity of renewable energy has maintained an annual growth rate of about 8% to 10%. By 2030, installed renewable energy capacity is expected to more than double from 2020.

On May 18 this year, the European Commission announced an energy plan called “RePowerEU”, which proposed to increase the overall target of the proportion of renewable energy in the EU’s “55% carbon reduction” policy portfolio by 2030, from the previous 40% to 45%. %. The plan also proposes to reduce the EU’s dependence on Russian natural gas by 2/3 by the end of 2022 and completely get rid of its dependence on Russian natural gas by 2027.

As an important part of the new energy revolution, the continuous upgrade and breakthrough of energy storage products and systems will effectively alleviate the randomness, intermittency and volatility of new energy power generation. The Guosen Securities report proposes that a high-proportion clean energy system requires sufficient adjustment capacity to cope with random changes from the consumption side and the supply side at the same time.

On the one hand, with the continuous increase in the penetration rate of new energy, the demand for energy storage in the energy system is getting stronger and stronger, and the energy storage is very promising when new energy is just needed. On the other hand, the breakthrough in energy storage will also promote the photovoltaic industry to usher in bigger outbreak.

Gao Changlu proposed that as the application scenarios gradually expand to the field of energy storage and green integration of buildings through hydrogen energy, the photovoltaic industry is expected to experience a greater explosion.



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