2017 is coming to an end,and the achievements of China's photovoltaic industry in this year have attracted worldwide attention.Taking advantage of the last month of 2017,let's look forward to the development prospects of the photovoltaic market in 2018.I still remember at the beginning of this year,after an unprecedented rush to install in 2016,the industry held a mentality of prosperity and decline,and it is widely expected that 2017 will be difficult to continue the prosperity of 2016.But in fact,the photovoltaic industry once again achieved leapfrog development in 2017,and the achievements made were even more impressive than in 2016.Can the photovoltaic industry continue to thrive in 2018 after continuous breakthroughs?Under the pressure of declining subsidies and affordable internet access,will 2018 rise and fall,ushering in a period of adjustment for the industry?
Subsidy reduction,forcing component prices down
According to the Notice of the National Development and Reform Commission on Adjusting the Grid Price of Wind Power Benchmarks for Photovoltaic Power Generation on Land,the grid price of photovoltaic power generation benchmarks will be adjusted annually based on cost changes.So the photovoltaic electricity prices in 2018 will inevitably be lowered again,and relatively speaking,people are more concerned about the magnitude of the reduction.According to the forecast,the next reduction in benchmark electricity prices for photovoltaic grid access will increase,with a specific range of 0.15 to 0.2 yuan(for details,click on"Where will China's photovoltaic industry go when subsidies decline?").Unlike previous years,the probability of distributed photovoltaic subsidies that have not been lowered for four years will be lowered in 2018.That is to say,photovoltaic subsidies will be comprehensively lowered in 2018,and in order to maintain profitability,the cost of photovoltaic power generation will inevitably further decrease.
How can the cost of photovoltaic power generation decrease?From the perspective of cost reduction space,only the inverter price has room for a decrease in system components other than photovoltaic modules,and the reduction is limited.Other products,including brackets,electrical equipment,cables,etc.,are relatively rigid in price,making it difficult for this part of the cost to be significantly reduced.In this way,the heavy responsibility of reducing system costs still lies on the component side.So with the comprehensive reduction of subsidies,the prices of photovoltaic modules will further decrease in 2018.The decrease in component costs mainly relies on process optimization and improved battery efficiency.In terms of process optimization,there has been a recent popularity of process optimization such as diamond wire cutting;In terms of improving battery efficiency,there is an expansion of production of PERC batteries,and there will be the development of new high-efficiency batteries such as N-type double-sided batteries in the future.So overall,the decline in subsidies will largely lead to a decrease in component prices.From the current improvement of component technology and battery efficiency,the industry is already prepared for the decline of subsidies.
Subsidy arrears are difficult to solve,and may be alleviated in 2018
Relatively speaking,photovoltaic power generation is an industry with a long investment cycle,so the capital flow of photovoltaic enterprises is particularly important.However,the existence of subsidy arrears has put additional financial pressure on photovoltaic companies,resulting in a generally high debt ratio.Lin Boqiang,President of the China Energy Policy Research Institute,recently stated that with the rapid expansion of wind and solar installations,the gap in new energy subsidies is greatly increasing.In 2012,China's"new energy subsidy"account had a surplus of 15 billion yuan,and by 2016,it had turned into a deficit of about 70 billion yuan.In 2017,China's photovoltaic installation increased significantly,bringing in nearly 30 billion yuan in subsidy demand in just nine months.
According to policies,subsidies for new energy should be compensated by renewable energy surcharges collected from sales electricity prices,but subsidies obtained from renewable energy surcharges clearly cannot keep up with the growth of new energy power generation.At present,to completely solve the problem of subsidy arrears,the only way is to accelerate the development pace of new energy power generation and accelerate the withdrawal of new energy subsidies.However,it still takes several years for subsidies to completely withdraw from the market,and without the introduction of new policies,arrears in subsidies will always be a problem.So before that,the country still needs other policies to alleviate the problem of subsidy arrears.
What is worth looking forward to is the green card trading policy.The National Energy Administration officially launched voluntary subscription for green power certificates on July 1st.Wind power and photovoltaic power generation enterprises can apply for green certificates through renewable energy power generation projects and sell them to subscribers,with a price not higher than the additional subsidy amount of renewable energy electricity prices corresponding to the certificates.According to the Notice on Trial Implementation of the Renewable Energy Green Power Certificate Issuance and Voluntary Subscription Trading System issued by the National Energy Administration,based on market subscription conditions,renewable energy power quota assessment and mandatory constraint trading of green power certificates will be launched in a timely manner starting from 2018.If the renewable energy electricity quota assessment and mandatory trading of green power certificates are launched in 2018,selling green certificates will be a feasible solution for enterprises struggling with subsidies and funding shortages.Due to the sale of renewable energy green power certificates by wind and photovoltaic power generation enterprises,the corresponding electricity no longer enjoys subsidies from the national renewable energy electricity price surcharge.Therefore,the enforcement of mandatory constraint transactions on green certificates will also alleviate the pressure of subsidy arrears to some extent.
In addition,the promotion of the distributed"partition wall electricity sales"model is also expected to alleviate the pressure of subsidy arrears,because under the"partition wall electricity sales"model,distributed photovoltaics have a high rate of return and can achieve user side affordable internet access.For enterprises that hold a large number of ground distributed photovoltaic power plants but are struggling with subsidy arrears,they can obtain stable cash flow income through the"wall sales"model,greatly improving the company's financial operation.According to the plan,before June 30,2018,the National Energy Administration will summarize and evaluate the pilot work of distributed generation market-oriented transaction,improve the relevant mechanism system,and determine the scope and time of promotion as appropriate.
Overall,facing the dilemma of subsidy arrears,the country is looking to solve the problem through multiple means,and other relevant policies may be introduced in 2018.
Reduce non photovoltaic costs and improve industry standards
At present,although the photovoltaic industry is getting closer to the goal of affordable grid access,achieving comprehensive affordable grid access still requires further reduction of photovoltaic power generation costs.However,while photovoltaic power generation has significantly reduced costs through various process improvements and breakthroughs in battery efficiency,non photovoltaic costs such as land and taxes have remained high,and this situation is expected to be improved.In September 2017,the National Energy Administration issued a notice on reducing the tax burden on enterprises in the field of renewable energy(draft for soliciting opinions),which released favorable policies such as"extending the policy of 50%refund of value-added tax immediately after collection","exempting land acquisition and occupation tax",and"stopping local governments from charging fees indiscriminately".In addition,the Ministry of Land and Resources,the Poverty Alleviation Office of the State Council,and the National Energy Administration also issued the"Opinions on Supporting Photovoltaic Poverty Alleviation and Regulating the Use of Land for Photovoltaic Power Generation Industry"in September 2017,which once again clarified the land use standards for photovoltaic power station construction and relaxed the use of land for the benefit of the country and the people in photovoltaic poverty alleviation.If the above policies can be well implemented,non photovoltaic costs will be significantly reduced.
In addition,due to rapid development,various standards in the photovoltaic industry are difficult to keep up with the pace of the market.Without the constraints of standards and norms,it is difficult for the industry to maintain good development.At present,China's photovoltaic industry urgently needs an authoritative,wide-ranging,and industry standard system that can meet the development of the industry.In response,the National Energy Administration,the Ministry of Industry and Information Technology,and the National Certification and Accreditation Administration have issued a notice on improving the technical indicators of major photovoltaic products and strengthening regulatory work.By 2020,China will initially form a scientifically reasonable,technologically advanced,and coordinated photovoltaic industry standard system,achieving full coverage of basic general and key standards in the photovoltaic industry,and overall meeting the needs of the development of the photovoltaic industry.
It is worth mentioning that 8 new standards will be implemented in 2018,which may slightly solve the urgent problem of lacking standards in the photovoltaic industry.On November 23,the National Energy Administration issued Announcement No.10 of 2017,which showed that the National Energy Administration approved 204 industry standards,which were implemented on March 1,2018,including 8 photovoltaic standards.These 8 standards are:
Industry reshuffle is imminent,and enterprises face life and death challenges
Although national policies are highly beneficial,it is an undeniable fact that market competition is becoming increasingly fierce.The industry is embarking on a new round of reshuffle,and enterprises are facing life and death challenges.Firstly,for upstream enterprises,due to the strong rise of the single crystal industry in recent years,there is a trend of gradually replacing polycrystals.It is predicted that the single crystal penetration rate will reach 27%by 2016,and it is expected to exceed 35%by 2017.In the future,the single crystal penetration rate will reach over 50%,becoming the main force of efficient products.The rise of single crystal will definitely squeeze the Lebensraum of polycrystalline industry,and some polycrystalline enterprises may not escape the fate of bankruptcy.In addition,it is understood that the progress of the polycrystalline transformation of Poly GCL's diamond line cutting at the polycrystalline leader has exceeded expectations.In November,the proportion of diamond line products has exceeded 90%,and the remaining B5 machines have also been renovated by the end of the year.Currently,100%of next year's orders have been fulfilled.The transformation of diamond wire brings higher cutting speed and lower silicon consumption,and there is no doubt that polycrystalline silicon manufacturers who cannot popularize diamond wire cutting technology will gradually be phased out.
For component manufacturers,due to the requirement of"reducing costs and increasing efficiency",the future will be the world of efficient components.At present,efficient products such as PERC components,black silicon components,double glass components,and double-sided components will become the darling of the market.And those components with low efficiency and outdated processes will gradually withdraw from the stage.In the future,enterprises without technological advantages and unable to produce efficient components will find it difficult to keep up with the pace of industry development.
For downstream power plant investors,due to the outbreak of distributed technology,the focus of photovoltaic development has shifted to the central and eastern regions,which face relatively high land costs.Due to the scarcity of high-quality roof resources,the development of household photovoltaics may trigger a trend of"grabbing roofs".Given that distributed photovoltaics are still in their early stages of development,products that have gained recognition,brand image,and good reputation will be favored by the market.
Overall,although facing pressure to reduce subsidies,the industry itself is becoming more efficient and non photovoltaic costs are expected to decrease.Therefore,the reduction in subsidies should not have a significant impact on the industry.In addition,the implementation of industry standards and norms will make the market more mature.It is expected that distributed photovoltaics will continue to grow rapidly in 2018,accounting for over 50%of the new installed capacity.On this basis,the photovoltaic market in 2018 will continue to maintain a growth trend.The turning point of the photovoltaic industry may need to be slowed down a bit before it arrives.