The widespread use of renewable energy is a long-term development trend in the future. Although China's photovoltaic has developed into the world's largest photovoltaic application market, China's energy structure is still dominated by traditional energy at the present stage. Vigorously developing renewable energy and promoting sustainable development is still one of the country's important development goals. As an important part of renewable energy, solar energy has many advantages and is the main trend of China's future development of new energy. China's solar photovoltaic market has broad development space in the future. Since 2019, the photovoltaic industry has entered a new round of business cycle, and the market attention continues to heat up.

I. Development characteristics and overview of photovoltaic industry

1. Development history of photovoltaic industry:

The development of China's photovoltaic industry can be divided into four stages, which witnessed the process of China's gradual maturity.

1) Photovoltaic industry start-up period (2001-2007) : During this period, China's photovoltaic manufacturing industry rapidly developed into the largest photovoltaic manufacturing country in the world in 2007, mainly focusing on the processing and export of batteries and modules.

2) Tortuous development period of the industry (2008-2013) : Affected by the global financial crisis in 2008, the global demand for modules declined sharply, resulting in unsalable photovoltaic products in China and the closure of some Chinese photovoltaic enterprises. At this stage, China began to realize the localization of the whole industry chain and large-scale industrial production of photovoltaic, becoming the main photovoltaic installed market.

3) Industrial technology revolution period (2014-2018) : The technological cost reduction in the battery link promoted the further prosperity of the domestic photovoltaic industry, and the production capacity entered the outbreak period.

4) Industry marketization period (2019-present) : With the launch of the "531" New Deal by the Chinese government in 2018 and the launch of the first batch of affordable projects, China's photovoltaic industry is approaching a subsidy-free era. In 2021, comprehensive affordable Internet access will be realized. Photovoltaic power generation has been fully rid of the restrictions of subsidies, and the photovoltaic industry has officially entered the stage of comprehensive market-oriented development.

2. Policy Level:

Global energy structure transformation is accelerating, favorable policies are coming out frequently, and photovoltaic industry is experiencing comprehensive and rapid development. After the russia-Ukraine conflict, the global energy transformation accelerated, and pv became an important support for energy transformation. Since May this year, various countries have actively introduced relevant policies to promote the development of photovoltaic industry. In China, favorable policies for new energy have been introduced. The "14th Five-Year Plan for Renewable Energy Development" and other policies guarantee the completion of China's new energy installation target in an all-round way from various aspects such as demand, consumption, approval, supply chain and finance. In Europe, RePower EU plan was launched in May, proposing that the photovoltaic installed capacity should reach 320GW by 2025 and 600GW by 2030. The policy encourages the demand for Photovoltaic in Europe to grow more than expected. In the United States, the Biden administration announced that the four Southeast Asian photovoltaic modules will be exempted from tariffs for 24 months, and the land cost of scenery project will be reduced by 50%. In the next two years, photovoltaic in the United States will rush to install, and global photovoltaic will usher in comprehensive and rapid development.

Development Trend of photovoltaic Industry 1. Industry development Trend: China's photovoltaic industry has entered a golden stage. The domestic pv industry chain is complete, technology and cost leading, global pv localization rate is high. Carbon emission reduction and carbon neutrality have become the trend of the world, and the development of photovoltaic industry has become one of the important ways for countries to implement energy conservation and emission reduction policies. Throughout the global pv industry chain, the domestic ship components accounted for more than 80% of the world, inverter shipment more than 70% of the world, and component upstream of the silicon material, wafer, such as batteries, film, glass production capacity both in the domestic layout is given priority to, cost advantage prominent, industrial supporting complete, the world's leading technology, the domestic photovoltaic industry chain has the absolute global competitiveness. As the proportion of new energy continues to increase, China will transform from a major importer of fossil energy to a major exporter of new energy. China will shoulder its responsibilities as a major country, lead the progress of global photovoltaic technology and industrial development, and promote global carbon neutrality with the development of the domestic photovoltaic industry chain.

2. Industry Demand:

Pv boom is positive, and the installed capacity in 2022 is expected to exceed expectations. It is expected that 2022 will be a big year of photovoltaic growth, and the market demand is expected to increase in the future, and the compound growth rate of new photovoltaic installations will remain high. Since 2015, the global photovoltaic installed capacity has grown rapidly. It is estimated that about 245GW of DC terminal installed capacity will be added in 2022. In the future, the new installed capacity is expected to maintain the growth rate, with a compound growth rate of about 25% in 5 years. 2022 The driving force for global pv demand expansion comes from important markets such as China, India, the United States, Europe and Brazil. Carbon neutral goal driven by countries around the world support photovoltaic capacity, given the recent eu pv installed 2025 targets, the United States in southeast Asia photovoltaic cells and component products exempt tariffs, highlight several important determination for the development of photovoltaic market countries, the global installed target continuously rise, is expected to important market in 2022 is still the main force of the pv demand expansion.

Global photovoltaic installation demand is growing, domestic and overseas photovoltaic, centralized and distributed demand resonance. Specifically,

1) The domestic comprehensive parity is started, and the "1+N" policy system centered on 3060 is gradually established. N supporting policies such as the promotion of the whole county, the scenery base and carbon emission reduction support tools are gradually implemented to support the completion of the 3060 target. It is estimated that domestic installed capacity demand will be around 90GW in 2022, an increase of about 70%.

2) The price of electricity is rising overseas, and the price of photovoltaic is highly acceptable. In addition, the European Union will account for 45% of renewable energy in 2030 and become carbon neutral in 2050, while the United States will become carbon neutral in 2035, and new energy will show a trend of continuous growth. It is estimated that the overseas market demand will reach 150-160GW in 2022, with an increase of 30%+.

3) Globally, the global pv installed capacity will reach 240-250GW in 2022, with an increase of 50%+; It will maintain 40% year-on-year growth in 2023. Under the long-term trend of carbon emission reduction, it is expected that the global photovoltaic installed capacity will exceed 510GW in 2025, and the global photovoltaic installed capacity will exceed 1400GW in 2030.

3. Industry supply:

The 2022 cap depends on silicon production. The supply of silicon material is tight in 2022, and the pace of new capacity expansion in the second half of the year determines the installed ceiling. According to the production plan of top silicon materials enterprises such as Tongwei, Daqo, Xinte, Asiansilicon and GCL, the nominal capacity of silicon materials will reach about 1 million tons by the end of 2022. Considering the uphill period of 4-6 months after the silicon materials are put into production, it is estimated that the actual output will increase by 250,000 tons in 2022, and the total global silicon material output will reach 850,000 tons, which is translated into about 290GW of components. Based on current projections of pv installed demand in 2022, silicon supply remains tight. After 2023, the silicon supply bottleneck opens, and the pace of supply and demand expansion is expected to be consistent.

Photovoltaic power generation is a technology that converts solar energy into electric energy by using the photogenerating volt effect of semiconductor interface. The industrial chain includes high purity polysilicon, silicon rod/silicon ingot, silicon chip, cell chip, module, photovoltaic power generation system and many other links. Generally speaking, the upstream mainly refers to the production of high purity polysilicon, the middle mainly refers to the production of polycrystalline ingot/single crystal pull rod and silicon, cell, module, etc., and the downstream mainly refers to the construction and operation of photovoltaic power generation system such as centralized/distributed photovoltaic power station.

Analysis of the development status of specific segmented fields:

1. Silicon materials: The strong terminal demand pushes up the price of silicon materials, and the marginal upward profitability. In the second quarter, pv prosperity remained high, and strong demand continued to push silicon prices. Since January 2022, the Indian tariffs empty window period, European demand to rise factors, such as terminal installed strong demand of silicon materials in short supply, prices rose to 270 yuan/kg of high water level, as in the third quarter is expected to tong wei co, new energy, li hao, east hope the new project put into production in qinghai's capacity, silicon material price is expected to be back.

2, silicon wafer: operating rate after the rebound to maintain a high price transmission ability to maintain a strong. Silicon wafer raw material cost transmission ability remains strong. Silicon wafer head manufacturer signed long single locking supply, "king on silicon for" master of silicon pricing power and cost conduction ability to maintain a strong, 182 monocrystalline silicon piece price rise to 6.78 yuan/piece after stability, is expected to follow-up with the silicon material supply capacity, the silicon new capacity, will change because of supply and demand and gradually reduce the unit price of silicon. The head wafer enterprises with supply chain advantages control the price discourse power, the cost transmission of silicon wafer is relatively smooth, and the profitability is still considerable.

3. Battery: The utilization rate rebounded under the stimulation of demand, and profitability was restored. Battery backward capacity to accelerate the clearing, bargaining power enhancement. Before 2022, the backward production capacity with weak bargaining power, weak cost pressure transmission ability and poor profitability will be phased out due to the scattered pattern of the battery sector. In 2022, the bargaining power of the battery link will be significantly improved compared with the previous one, and the price transmission ability will be enhanced. Currently, the price of 166/182/210 batteries respectively reaches the peak of 1.14/1.20/1.18 yuan /W. Since 2022, it has been continuously stimulated by downstream demand, and the recovery trend of operating rate is significant, and the profitability of single battery segment has been repaired.

4, components: components under high boom demand, price is stable with rising, operation rate marginal upward. Modules are the last part of photovoltaic manufacturing. It is expected that the strong demand for photovoltaic installations throughout the year will continue to support the high operating rate of modules in 2022. The price of components supported by strong demand reached 1.88-1.97 yuan /W. In addition, due to the high price of raw materials such as upstream silicon material and rubber film, component manufacturers have increased the price of transmission cost. The double-sided 540+ mainstream quotation of mainstream front-line enterprises was 1.96 yuan /W, with the price rising steadily. The subsequent release of silicon capacity brings silicon prices down, making the profitability of components return to normal levels.

5, inverter: high-boom track stacking, inverter industry set sail. The new market of energy storage is about to explode, and the development space of energy storage inverter is broad. According to THE data of CNESA, the global electrochemical energy storage market is expected to increase by 8.37GW in 2021, with a year-on-year growth of 77.8% and a cumulative installed scale of 22.6GW with an annual growth rate of 58.7%. By the end of 2025, the global electrochemical energy storage market will have a cumulative application scale of 138.6GW. From 2020-2025, Approximately 10-fold growth in five years, with a CAGR of 57.3% in 2021-2025. With the rapid growth of energy storage market, the demand for energy storage inverters has exploded and the development space is broad.

6, film: "one super two strong" competition pattern is stable, gross margin is expected to rise. Photovoltaic film market concentration is high, leading enterprise Foster's global market share of more than 50% for many consecutive years. Among the top five leading enterprises in 2021, Foster's market share will account for about 57%. Compared with other comparable companies, Foster's has stronger profitability and comprehensive operating capacity. In the short term, its leading position is hard to shake, and the market share of some second-tier film enterprises is expected to increase. "One super" Foster city is far ahead of the "two strong" Hayuswick gradually catching up.

7, glass: under the policy constraints of orderly expansion of capacity, capacity of the head manufacturers will maintain a leading position. Due to the implementation of capacity replacement policy in capacity risk early warning mechanism, the expansion progress of photovoltaic glass new entrants is slower than expected. It is expected that the photovoltaic glass industry will enter an orderly expansion stage under the constraints of the policy in the future, and the leading manufacturers are expected to continue to maintain a dominant position. In 2021, the gross margin of Photovoltaic glass business of Follett was 35.7%, which was similar to xinyi photovoltaic glass business of the same head manufacturer, and the gross margin gap with other enterprises was more than 10pct, due to the accumulation of advantages of the head manufacturer in many ways, such as low raw material cost and leading kiln size.

In 2022, the solar photovoltaic market demand continues to explode. Since the end of April, the photovoltaic plate has fluctuated upward, and the long-term high prosperity of the photovoltaic plate has not decreased. On the one hand, with the support of the domestic carbon neutral carbon peak target, favorable policies such as the promotion of large bases and the whole county have been gradually realized. Overseas, under the influence of the Russia-Ukraine incident and the pressure of energy transition, the installed demand has been increasing and the industry prosperity has maintained a high level. On the other hand, it is expected that with the release of new silicon capacity in the second half of 2022, the pressure on the supply side is expected to gradually ease, and the fundamentals of the photovoltaic plate will be further improved. Overall, photovoltaic plate prosperity is still high, the follow-up is expected to continue to maintain.