Starting from satellite power supply, after decades, China's photovoltaic industry has continued to expand in scale and occupy a leading position in the world.
In 2023, the production of major manufacturing links such as polysilicon, silicon wafers, batteries, and components in China increased by more than 60% year-on-year, with a total industry output value exceeding 1.75 trillion yuan. In this year, the newly installed photovoltaic capacity in China reached 216.88 gigawatts, a year-on-year increase of 148.10%; Equivalent to the global increase in photovoltaic installed capacity in 2022, it continues to lead the world.
As a cyclical industry, the development of China's photovoltaic industry has experienced ups and downs. It has once staged the myth of wealth creation, and has also undergone several rounds of reshuffling. batches of excellent enterprises and entrepreneurs have stepped onto the historical stage, transforming and moving forward in the midst of changes.
In 2023, the prices of various links in China's photovoltaic industry plummeted, with overcapacity and external tariff policy restrictions, posing challenges to the industry; But the other side of the coin is the continuous expansion of photovoltaic scale under the dual carbon strategy, with a bright industry prospect.
Ice and fire intertwine, tempering the resilience of the industry.
Faced with a cyclical downturn, players from all walks of life optimize their strategies and embrace a new stage. As a leading enterprise, Jingke Energy (688223. SH) has a clear understanding of the industry and is firmly confident in leading the industry forward. From repeatedly breaking the century record for battery efficiency in research and development, to industrialization, large-scale production, and closed-loop industrial chain, Jingke Energy achieves high-quality development through technological and industrial innovation.
"Supply and demand turbulence, technological changes, and competitive disruption" is the judgment made by Li Xiande, Chairman of Jingke Energy, on the current development of the photovoltaic industry in his annual message "2024: Belief". The industry has entered a downward cycle, but in his view, the photovoltaic industry itself is a high-quality development, never afraid of short-term fluctuations, let alone worrying about the future development trend.
Recently, in a conversation with Time Finance, Li Xiande stated that we should not overestimate the turbulence of 1-2 years and underestimate the trend of the next decade. The long-term upward trend in the industry remains unchanged, and the more the market is in a downturn, the more confident one should be, because as costs decrease, photovoltaics are the future of energy.
In the face of the "Hundred Flowers Blooming" photovoltaic technology route debate, Li Xiande believes that photovoltaic is ultimately an investment product, and high cost-effectiveness has always been the direction pursued by customers. The cost reduction and efficiency improvement brought about by technological innovation has always been the main theme of the photovoltaic industry. The continuous upgrading based on N-type TOPCon will still be the mainstream technology route in the industry in the next three to five years.
The following is a transcript of the conversation:
Strive to become the industry's first "all N-type production capacity company"
Time Finance: In recent years, Jingke Energy has been betting on N-type TOPCon technology. From the data, Jingke Energy has put into production over 70GW of high-efficiency N-type batteries last year, The shipment of N-type components increased by over 300% year-on-year, accounting for approximately 62% of component shipments; By the first quarter of this year, the average production efficiency of N-type batteries had exceeded 26%. What is the main reason why Jingke Energy firmly chooses N-type TOPCon? Will the future still firmly adhere to this technological path? What methods will be used to improve and upgrade the construction of the supply ecosystem?
Li Xiande: The company's choice of TOPCon is not simply a "bet", but based on a comprehensive and rigorous comparison of various N-type technologies. Compared with other technologies of the same generation, N-type TOPCon has three main advantages: high conversion efficiency upper limit, low-cost industrialization, and better equipment matching. It is expected that its market share will exceed 70% by 2024. With the introduction of new technologies and the participation of more players in cost reduction and efficiency improvement, the N-type TOPCon is likely to remain the absolute mainstream technology route within three to five years. In the future, the company will fully leverage the advantages of N-type TOPCon technology as a "chain master enterprise", actively explore new materials and solutions, and continuously improve the supply ecosystem construction around the company to ensure long-term supply and cost competitiveness.
Time Finance: Jingke Energy and Trina Solar are betting on TOPCon technology, while Longi Green Energy is choosing BC technology. At the same time, technology routes such as HJT and perovskite stacking are refreshing battery efficiency, and the speed of commercial maturity is accelerating. How do you view the phenomenon in this industry as the technology roadmap is flourishing?
Li Xiande: Currently, almost all top enterprises have chosen TOPCon as their mainstream technology route layout, which to some extent accelerates TOPCon's technological innovation and cost reduction and efficiency improvement. HJT technology is still facing cost pressure, and there are limited opportunities for large-scale production in the current market price and financing environment. The biggest problem with BC is the double-sided rate, and there are opportunities for high efficiency in sub markets such as rooftops. As a branch technology route, the company has a layout, but currently does not have mass production economy. The perovskite stacked battery is a way to break through the efficiency limit of single crystal silicon batteries. The company has also achieved a conversion efficiency of about 33% for perovskite stacked batteries based on TOPCon in the laboratory, opening up space for the combination of TOPCon and next-generation technology. However, currently limited by issues such as area and material stability, perovskite stacked batteries will still be mostly in the laboratory or pilot stage in the next 2-3 years.
Time Finance: Can there be a technological route in the future that can "unify the world"? How do you view the impact of technology roadmap on industry and enterprise development?
Li Xiande: Photovoltaics are ultimately an investment product, and high cost-effectiveness has always been the direction pursued by customers. The cost reduction and efficiency improvement brought about by technological innovation has always been the main theme of the photovoltaic industry, but compared to laboratory records, we focus more on the maturity of weight production and LCOE (Levelized Cost of Energy). Moreover, in the current industry where overall prices, profits, and financing are under significant pressure, the introduction of new technologies into mass production should be more cautious. Therefore, the continuous upgrading based on N-TOPCon will still be the mainstream technology route in the industry in the next three to five years.
Time Finance: 2024 is an important year for Jingke Energy to face intensified industry competition and cross industry cycles. Jingke Energy has stated that it will maintain a cautious pace of expansion, prioritize the landing of advantageous production capacity, and accelerate the elimination of backward production capacity. How do you view the industry cycle? What are the plans of Jingke Energy for backward production capacity and new advantageous production capacity in the stage of alternating old and new production capacity?
Li Xiande: We often say, "Don't overestimate the turbulence of one or two years, and underestimate the trend of the next decade.". The long-term upward trend in the industry remains unchanged, and the more the market is in a downturn, the more confident one should be, because as costs decrease, photovoltaics are the future of energy. Currently, The rapid decline in demand for P-type components has driven down bidding prices, putting significant pressure on the prices and profitability of the entire industry chain. The company's P-type production capacity burden is relatively small, and this year it will accelerate the clearance of outdated P-type production capacity, striving to become the first "all N-type production capacity company" in the industry.
Time Finance: What preparations has Jingke Energy made in terms of technological transformation and iteration of outdated production capacity? How effective is it?
Li Xiande: After the conversion of PERC production capacity to TOPCon, it is relatively uneconomical in terms of single line output, manufacturing costs, yield, and other aspects. There is still significant room for technological upgrading and transformation of N-type TOPCon technology in the future. The company has a clear plan for improving efficiency and reducing costs of N-type technology in the future, and has reserved space for upgrading and transformation during production capacity construction. Currently, the mass production efficiency of N-type batteries has exceeded 26%, and it is expected to exceed 26.5% by the end of the year. The company will continue to iterate and upgrade in the future.
Time Finance: The photovoltaic market continues to expand, but the low prices have had a significant impact on the revenue and profits of enterprises, with some leading enterprises experiencing losses in the first quarter. As an industry leader, how can Jingke Energy improve its profit margin? What are your expectations for industry turning points?
Li Xiande: Firstly, the company will continue to promote technological and production capacity innovation to improve efficiency and reduce costs, and enhance product competitiveness; Secondly, we will further strengthen our global layout, enhance our ability to serve the world, and capture opportunities in high priced overseas markets. Jingke Energy has advantages in product leadership, market capability, and capacity utilization. We believe that we can cross the cycle and enhance our industry position.
The current pace of industry capacity clearance is difficult to judge. But non competitive production capacity, non market capacity, and non technological iteration capacity will accelerate elimination.
Building a global supply system and capturing opportunities in emerging markets
Time Finance: Jingke Energy has made some arrangements for energy storage, but in 2023, Jingke Energy's energy storage business revenue has not yet been attributed to the main business revenue sector. How does Jingke Energy position itself in the energy storage sector? How will we make efforts in the field of energy storage in the future?
Li Xiande: Photovoltaic energy storage will be a key measure to solve the volatility of photovoltaic power generation and open up consumption bottlenecks. It is expected to become the main supply mode of electricity in the future. The company regards energy storage business as a long-term strategic business layout, but in the short term, it is still in the stage of market cultivation, customer trust building, and production and research and development system establishment. In the future, it will actively and steadily promote capacity layout.
Time Finance: What kind of operational system has Jingke Energy established in the energy storage field? What are the advantages compared to peers? How is the progress and effectiveness of the integration of light and storage?
Li Xiande: Currently, the company has released comprehensive energy storage solutions covering the source network side, industrial and commercial sides, and household sides. The product solutions are constantly innovating in technology and performance. In terms of production capacity, the company's 4GWh energy storage system production line has been put into operation, and the construction of battery and system production capacity will be orderly promoted in the future. The company will leverage the synergistic effect of energy storage and photovoltaic main businesses, actively explore the market, and has currently signed orders with multiple global power developers, distributors, and end customers. It is listed as a first tier supplier in the latest BNEF energy storage supplier classification list released in 2024.
Time Finance: Currently, Jingke Energy's products have been sold to more than 190 countries and regions worldwide, covering more than 3000 customers worldwide, establishing over 120 global marketing branches, and having over 30 global service centers. Its market share in various emerging markets around the world continues to increase. What is the most challenging challenge for Jingke Energy during the process of going out to sea? How does Jingke Energy respond to the opportunities and challenges encountered during its overseas expansion?
Li Xiande: The current international trade environment has put forward higher requirements for the long-term stability and reliability of supply chains. These all require a certain amount of time to accumulate, not overnight efforts. The company has been committed to building a global supply system and focuses on promoting carbon footprint management, supply chain traceability ESG、 Patent and other work have made positive progress.
In addition, the construction of global brands and word-of-mouth also requires long-term accumulation. The company's overseas business accounts for a leading proportion in the industry, and in the reliability rating of PVEL components BNEF Bank is in a leading position in the industry in terms of financing ratings, which is also a threshold that new entrants to overseas markets must face.
Time Finance: Europe is the second largest photovoltaic market in the world, and Jingke Energy's revenue in the European region in 2023 is only second to domestic business revenue. But at present, there is also a risk of trade barriers in the European region. Faced with such a market, how will Jinko Energy consolidate its market position in Europe? What are Jingke Energy's plans for the future development of overseas markets?
Li Xiande: The company will maintain high R&D investment and build long-term technological and product leading advantages through continuous technological innovation; And with the most 35 overseas service centers in the industry and world-class product service concepts, we will continue to do a good job in brand, channel, and after-sales system construction; At the same time, we will continuously optimize the construction of the ESG system, promote carbon footprint management and supply chain compliance system construction, in order to cope with fierce industry competition and policy and demand changes in the European market.
The company follows a balanced global market layout and maintains a leading share in major overseas markets. Europe, as the largest regional market, will always be one of the key areas of the company's layout. Meanwhile, in recent years, emerging markets have grown rapidly, and the company will actively seize opportunities in rapidly growing emerging markets such as the Middle East, Latin America, and Southeast Asia.
Time Finance: During your recent visit to France with the delegation, you proposed that it is imperative to accelerate the consumption and upgrading of new energy technologies. We need to integrate technological innovation and application innovation, make more Chinese standards international standards, and leverage the role of energy transformation in promoting the transformation and upgrading of traditional industries. What technology research and development system has Jingke Energy established? On the journey towards internationalization, how can Chinese standards go global and help strengthen international discourse power?
Li Xiande: The company has established a comprehensive and efficient research and development system based on the National Enterprise Technology Center, Provincial Enterprise Technology and Research Development Center, and Postdoctoral Research Workstation. Adhering to the concept of "exploring one generation, researching and developing one generation, and mass producing one generation", we have established a technological innovation development direction of "high efficiency, low cost, intelligence, and informatization", advocating integrated and sustainable innovation throughout the entire industry chain, effectively embedding technological innovation into all aspects of production, and achieving maximum innovation value.
As of the end of 2023, the company has applied for more than 3800 patents and obtained more than 3500 authorized patents, becoming one of the enterprises with the highest number of patent applications and authorizations in the photovoltaic industry. At the same time, it is also the enterprise with the highest number of patents related to N-type TOPCon technology; The company has also led the development of multiple international and domestic industry standards, including IEC.