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PV-Tech research reveals how to assess PV module suppliers’ capacity claims

This article continues our series of features introducing new methodology that allows leading PV module producers to be categorized, ranked and short-listed by manufacturing and financial strength metrics; ultimately providing an investor-risk (or bankability) profile of bankable module suppliers for non-residential end-market selection.

This is the second of six articles on that will provide full transparency on the methodology used to assign investment risk to PV module suppliers selling to commercial, industrial and utility segments of the industry. The full dataset captures research findings by PV-Tech going back more than 10 years.

The first article, PV-Tech research set to reveal investment grades for global PV module suppliers, introduced the research methodology, focusing on the supply strength ranking of PV module suppliers. This (second) feature focuses on the capacity factor used within the bankability rankings study.

The output from the overall analysis – accumulated by the PV-Tech research team over the past five years in particular – will form a key part of my opening talk at the forthcoming PV ModuleTech 2019 conference in Penang, Malaysia on 22-23 October 2019.

Methodology overview

The first article introduced the basic relationship between module supplier bankability (B), manufacturing (M) and financial (F) scores as:

where k is a scaling factor that maps bankability scores to a 0-10 band, m and n are power coefficients derived from regression analysis, and i is a variable that is module-supplier and time-period specific. The manufacturing health score/ranking is expressed as:

where a, b, and c are factor-dependent weightings, scaled to generate manufacturing health scores for each company by quarter (i) in a 0-10 band; S, C and T are the module supplier shipment, capacity and technology ratios introduced above; p, q and r represent power factors derived from regression analysis.

This article focuses on the capacity score (C) and how this is derived.

Manufacturing capacity (C) strength score methodology

The manufacturing capacity factor (C) ranks PV module suppliers, by looking at in-house cell and module effective quarterly capacities across different global PV manufacturing zones, and factoring in the access these manufacturing zones have at any given time to global module supply end-markets.

This type of analysis turns out to be incredibly insightful, and explains why the common practice of PV industry observers to consider one capacity number (often based on unsubstantiated nameplate single-entry data points) is both misleading and inappropriate within a changeable trade-barrier influenced global landscape where origin-of-manufacture is of the utmost importance.

First, I will explain some of the key issues related to capacity within the PV industry today.

Excluding thin-film PV technologies, all c-Si based module suppliers operate with different levels of backward-integration capacity, across cells, wafers and ingots. While various Chinese companies have subsidiary operations that produce polysilicon, no company today in the PV industry operates with a full value-chain model where every component is made in-house.

Across the ingot-to-module stages, the most critical parts in terms of module supply are cell and module production. Wafer supply has now become a China-centric commoditized offering, and crucially this part of the value-chain has been exempt from trade-related origin-of-manufacturing. Indeed, with more than 95% of c-Si wafers produced today within China, there is even less prospect of wafer supply being incorporated into any meaningful tariff-related policy.

Moreover, such trade-related duties have typically focused on the cell and module segments of the value-chain. Therefore, in assessing company-specific capacity-based strength metrics, it is the cell and module stages that are important to evaluate. This becomes further justified when recalling that module specifications are mostly driven by cell performance and quality.

In addition to the need to have high levels of in-house cell and module capacities, most Chinese c-Si module suppliers have routinely relied upon strong third-party outsourcing of cells and modules.

At the two extremes of the Chinese module supply practice are the fully-integrated in-house supply-constrained model, and the so-called ‘fabless’ alternative.
Leading multi-GW module suppliers – that adhere to using only in-house produced cells and modules – are the exception within the PV industry today. Indeed, the practice of relying on third-party companies for production has only increased in recent years, with Southeast Asia based companies often being called upon when shipping modules without prohibitive duties to the US (and until recently, to Europe).

By default, the only multi-GW thin-film producer (First Solar) is mandated to use in-house product, as a result of being technology-differentiated; this is an exception to the rule today, with the company being the only truly-differentiated alternative to non-residential (commercial, industrial and utility, or CIU) applications.

The fabless model – where all manufacturing is outsourced – remains popular within adjacent technology sectors (in particular, the semiconductor industry), but has been largely ineffective until now within the PV industry. The only company that sought to pursue a cell/module fabless model was SunEdison several years ago.

Other companies (including several Japanese module suppliers) did shift to strong outsourcing in an attempt to stay competitive (quasi-fabless), but such efforts were largely short-lived. In reality, a host of factors has prevented the fabless model working in the PV industry, including single-digit production margin constraints, and the need to quickly adjust to market dynamics resulting from technology and tariff related issues.

In assessing the relative strengths of module suppliers, in terms of manufacturing capacity, it proved necessary to fully understand how much effective cell and module capacity was owned by each company, and across which manufacturing zones globally. In particular, the levels of cell and module capacity by zone turns out to be crucial in assessing which end-markets are on offer through in-house cell and module production. The growth of cell and module capacities across Southeast Asia in recent years illustrates this point succinctly.

The analysis of manufacturing capacity strength (C) starts by splitting each company’s effective cell and module capacities across eight pertinent manufacturing zones globally: China, Taiwan, India, Japan, Southeast Asia, the US, Europe and the Rest of the World (RoW). These locations are chosen in part from a legacy manufacturing standpoint (in particular Japan), and crucially because trade-related import barriers tend to differentiate between cell and modules produced and shipped from these areas (origin-of-manufacture).

This type of segmentation is also important because ultimately the strength of in-house capacity depends on the served addressable market (SAM) available; namely which end-markets are absent of prohibitive import conditions at any given time.

This has been most pronounced in the case of China over the past decade. As such, it can be concluded a Chinese company having multi-GW of in-house cell and module capacity only in China sees a lower SAM for its factory output, compared to a competitor that has domestic and overseas manufacturing capability. While this alone is a simplistic case-study, the reality is a rapidly evolving global landscape that needs a robust methodology constructed in order to deal with changes by manufacturing zone and regional end-market supply (export and import).

The first part of the analysis here therefore requires the effective quarterly cell and module capacities (Cap) by quarter, for the top-100 module suppliers globally, to be segmented into each of the eight manufacturing zones (p=1…8), as outlined above.

For reference, effective capacity refers to the available/ramped capacity and its maximum productivity levels if operated 24/7. Very few fabs operate under these conditions in the PV industry, with only First Solar having a consistent track-record of fab productivity in the 95-100% range over a multi-year time period. The key issue here though is to differentiate between erroneous and misleading capacity figures that are all too commonly used within the PV industry, such as nameplate capacity or ‘available’ capacity (which is often no more than an ambitious summation of in-house and third-party capacities that can be called upon if needed).

Effective capacities in general go up and down every quarter, due to efficiency/power improvements at the module level, technology upgrades, debottlenecking, routine maintenance, or temporary factory mothballing. 

A key indicator of capacity definition used within the industry by any company/observer can be understood quickly, by noting that effective capacity figures are different every quarter: erroneous nameplate or ‘available’ capacity figures are often quoted to the nearest 100MW or GW and don’t change, by comparison. 

Another guide may come from related utilization rates cited that exceed 100%, reflecting inaccurate capacity allocations: capacity conversion is a more accurate means of quoting utilization rates in practice.

With the eight segmented module capacities (Cap) by manufacturing zone location established, the next stage is to determine how much effective in-house cell capacity is available to each of the module suppliers in these zones. 

This is important as it allows us to differentiate between modules produced by any company (in any zone) using in-house cells (IHC) or third-party cells (TPC). As discussed above, a major part of module quality, performance and reliability can be traced back to the origin of cell manufacturing; additionally of course, module trade-barriers routinely extend to cell component origin-of-manufacture.
The resulting module capacity (Cap) value by company (i) by manufacturing zone (p=1…8) can therefore be expressed as:

where the c coefficients are weighting factors that depend on whether module capacity uses in-house cells made in the same manufacturing zone, Cap(IHC), or by third-party cell producers, Cap(TPC).

This clearly promotes the strength of module suppliers that use in-house made cells only, produced local to module assembly activity. This is entirely consistent with how the industry operates today, and is a key issue for any investor-led due-diligence process as it pertains to module quality and bill-of-materials integrity.

The weighting factors, c, are qualitative data entries by nature, and can be adjusted by quarter or by manufacturing zone depending on how important in-house vertical integration of cells and modules is. The precise relative weighting between the factors turns out to be somewhat secondary within the overall bankability studies, and as such it is not essential to overcomplicate this part of the analysis, other than to have a means of differentiating between IHC and TPC supply-chains.

For reference, First Solar’s manufacturing is split up into cell and module capacities, although a single thin-film line incorporates the equivalent of c-Si cell/module stages. By default therefore, all First Solar product is cell/module matched, as it is for other thin-film makers in general.

The next stage of the analysis is the most important and valuable part of the overall capacity strength factor studies, because it introduces the impact of trade (export) restrictions on modules produced within any of the eight (p=1…8) manufacturing zones shipped to any of the six (j=1…6) end-market regions (Reg) that were introduced in the first part of the article series before.

Simply put, the value of having module (and cell) capacity in any part of the world is only as useful as the SAM available at any given time, factoring in trade-barriers that tend to be somewhat binary in nature when it comes to market accessibility (either the end-market region is ‘open’ or ‘closed’ with limited scope for any middle-ground).

One of the most insightful example of this relates to Chinese cell/module capacity (one of our eight manufacturing zones) and shipments into Europe (one of our six end-market regions). Prior to the establishment of the minimum import pricing (MIP) constraints imposed by the European Union on Chinese imports, Europe was fully accessible to Chinese produced modules. Once MIP was imposed, shipments from China to Europe collapsed to near-zero. Then when the MIP was removed, Europe than became fully-accessible again to Chinese produce.

In order to restate module capacity by company/quarter within the eight manufacturing zones globally, each capacity value (obtained through the summed term above) is multiplied by an end-market ‘access-related’ factor that is both manufacturing region and end-market specific.

To do this, the module sum factor (above) for each module supplier is multiplied by a quarterly-variable term based on combining the total quarterly CIU demand (Dem’) (for each of six end-market segments (j=1…6) for shipments) with a qualitative access percentage term (Access) that defines the availability of end-market j for module production in manufacturing zone p at any given point.

For example, returning to the Chinese module capacity example above, where the manufacturing zone is China, then China-specific access percentage terms would be 100% for China (naturally), and near-100% for regions such as Europe (today), Japan and most of the RoW sub-segments. By contrast, percentage levels would be very low for shipments to the US market, and fluctuating for supply to the Indian market.
The pro-rated regional contributions for each manufacturing zone are finally scaled by dividing by the total global CIU market demand in each quarter. This overall scaling factor can be expressed as:

Therefore, this type of analysis not only adjusts module capacity by manufacturing zone, it also scales the size of served end-market by the importance of each region, by looking at the ratio of the demand (CIU) from that region and the total CIU demand each quarter.

The steps above turned out to among the most insightful within the overall study, in building up the manufacturing strength of PV module suppliers in the industry. This analysis clearly takes capacity assessment (previously largely misunderstood and erroneously presented) to a new level of scrutiny, and finally allows for capacity to be valued based on where the product is made, how much incorporates in-house and local cell supply, and which end-market is being targeted; for all module suppliers, by quarter.

The final capacity score (C) of each module supplier is then simply the sum of the scores derived for all eight manufacturing zones, by quarter. The full equation can be written finally as:

where k is a variable quarterly scaling factor, to map capacity scores into a 1-10 band; again based on distribution and standard deviation checks done by quarter.

It should also be pointed out that the capacity analysis here is confined to quarter-only data points, and not any trailing for forward-looking time periods (as was entirely valid for the supply/shipment analysis before). This is done because capacity strength is an instantaneous variable (has a specific value at any given moment in time) that is entirely dependent on regional trade-access conditions.

Manufacturing capacity (C) strength score output

Similar to the analysis covered in the manufacturing supply (S) analysis outlined in part 1 of this series, the manufacturing capacity (C) study yields a vast quantity of benchmarking for different PV module suppliers, when isolating manufacturing zones and end-market shipment regions over different time periods.

For now however, we look at the final C values for PV module suppliers, choosing to show year-end values for simplicity, although the analysis of course tracks scores by quarter.

The graphic below captures PV module supplier scores from the top 100 companies in the industry today, with a few highlighted again to convey key trends arising from the analysis.

While the highlighted companies show a range of different fortunes for PV module suppliers’ capacity strength factors, the most interesting ones to discuss are those of Canadian Solar and Hanwha Q CELLS. Each of these companies has maintained capacity effectiveness by having a flexible strategy that allows modules made in different manufacturing zones to be prioritized at different times, depending on which end-markets are favourable to origin-of-manufacture. 

The case of Hanwha Q CELLS is perhaps the most robust in this regard, with the company able to adjust product availability from China, Korea, Malaysia (and now the US) as and when trade conditions apply; only companies with strong balance sheets can purse this strategy for any meaningful length of time.

Previewing the next part of the article series

The next article in this series will focus on the last term in the manufacturing health score analysis; technology (T). This allows us to incorporate R&D spending (confined to PV operations) and capex (restricted to cell and module stages) for each of the 100-plus module suppliers under review, again analysed by quarter.

The conclusions will be shown during the article to reveal the unique way in which R&D spending and capex (the hallmarks of technology leadership in other technology sectors) impact on PV manufacturing strength and module bankability rankings.

Attend PV ModuleTech 2019 to hear the first presentation on the findings

The full results of the overall study will be released by the PV-Tech market research team before the end of August, with the key findings presented, explained and discussed in the 45 minute opening talk I will be giving at the forthcoming PV ModuleTech 2019 event in Penang on 22-23 October 2019.

Read the entire story

PV-Tech research set to reveal investment grades for global PV module suppliers

This article introduces a new methodology that allows leading PV module producers to be categorized by manufacturing and financial strength metrics, ultimately providing an investor-risk (or bankability) profile for non-residential end-market selection.

This is the first of six articles on that will provide full transparency on the methodology used to assign investment risk to PV module suppliers selling to commercial, industrial and utility segments of the energy industry.

The output from the analysis – undertaken by the PV-Tech research team over the past five years – will form a key part of my opening talk at the forthcoming PV ModuleTech 2019 conference in Penang, Malaysia on 22-23 October 2019.

Summary of the investment-risk methodology used

Investment-risk (or bankability) scores for all PV module manufacturers are obtained by combining manufacturing and financial health scores, through nonlinear/power regression analysis. The data used is dominated by quantitative inputs (six years back and two years forward in the case of forecasted variables), with qualitative data kept to a minimum. At each stage of the analysis, comparison is made with how the module makers have been perceived in the market from a bankability/investment perspective.

The basic relationship between module supplier bankability (B), manufacturing (M) and financial (F) scores will be shown during the series of articles to follow the nonlinear relationship:

where k is a scaling factor that maps bankability scores to a 0-10 band, m and n are power coefficients derived from regression analysis, and i is a variable that is module-supplier and time-period specific.

The manufacturing health score, M, for any individual module supplier, at any given time (quarter, year-end, etc.) is determined through gathering a wealth of data for all module suppliers, annually back to 2013 and by quarter back to Q1’15, and analysing the dependency of this data on overall company-specific manufacturing status within the industry at any given time period.

The full series of articles will explain this in detail. The manufacturing score, M, will be shown to be a combination of module supply (shipment), capacity, and technology ratios. The manufacturing score, M, will be shown to be derived by the relationship:

where a, b, and c are factor-dependent weightings, scaled to generate manufacturing health scores for each company by quarter (i) in a 0-10 band; S, C and T are the module supplier shipment, capacity and technology ratios introduced above; p, q and r represent power factors derived from regression analysis.

The above relationship is therefore a linear combination of nonlinear/power terms, with the presumption that the three terms S, C and T independently affect the dependent M values. Over the course of the articles, I will discuss the dependency of factors used to establish final module supplier bankability ratings, as this is not simple by any means. However, I will show that certain parameters dominate company-specific metrics (in particular, when calculating the manufacturing health metric and the final bankability metric), minimizing the impact of other inputs (for example, R&D spending, that may be valuable to track in other adjacent technology sectors, but for PV and module bankability has limited bearing).

This article focuses on the manufacturing supply score (S) and how this is derived. Following articles will cover the other manufacturing score factors (C and T), the overall manufacturing health score (M), before finally I address the financial analysis (F) and the overall bankability scores (B). The bankability scores form the basis of investment risk grades that will be of great value to investors looking to short-list and compare different module suppliers and technologies for large-scale site selection globally.

All six of the articles will be archived within a specific section of the PV-Tech website, allowing any interested party to understand fully how the final bankability metrics of all PV module suppliers are derived and calculated.

Manufacturing supply (S) strength score methodology

The manufacturing supply factor (S) captures market-share by branded module shipment volume, and has routinely been part of solar PV ranking tables for many years, albeit in a very simplified and generic version.

Shipment of branded modules includes modules assembled at company-owned facilities, in addition to outsourced (or third-party) supply where end-market shipped product is relabelled to that of the company making the sale. Third-party outsourcing has been used frequently within the solar industry for many years, either to supplement short-term spikes in order pipelines, or to circumvent origin-of-manufacturing location constraints arising from trade tariffs or related (production) barriers.

Ranking tables for module supply are often done on an annual (calendar year) basis, typically confined to top-10 shipment estimates. These rankings should always be restricted to branded-module shipments to end-market customers (sometimes called merchant shipment volumes, specifically excluding any OEM supply or subcontract production line leasing). Many times however, the definitions are lacking, or the rankings were compiled in the absence of any understanding of the different factors that make up any module supply shipment numbers in the first instance.

Therefore, shipments volumes for our analysis are defined as own-company branded, including both in-house produced and third-party/OEM supplied. This is essentially how most leading module suppliers operate in the PV industry, with the exception of a few that are technology-specific.

The analysis starts by identifying each company’s megawatt (MW) shipments (Ship) by quarter. These quarterly shipments are then allocated to one of six (j=1…6) end-market regions (Reg). Each of these segmented numbers is then split into non-residential contributions (Ship’).

Non-residential allocations are comprised of commercial, industrial and utility-based shipments, abbreviated here as CIU. While the PV industry does not have universally accepted nomenclature for end-market segments (as defined by customer type or mounting arrangement), the use of residential/non-residential is the most important grouping mainly because residential deployment is largely absent of supplier due-diligence and bankability studies (common to larger utility-based projects). Non-residential is routinely labelled as commercial, industrial or utility, by different PV companies, with the terms somewhat interchangeable.

Having removed the residential part of the quarterly/regional company shipment volumes, this completes the company specific quarterly segmentation of the input data. The remaining analysis now uses these data values combined with historic and future market demand, as explained below.

Shipment strength is often considered in the PV industry to be based on market-share, whether globally or sometimes by region/country, and mostly covering calendar year periods in the past.

However, market-share claims are rarely substantiated, qualified or confirmed by any independent agency. Furthermore, market-share studies often lack country/region segmentation, time-period determination and deployment specifics (e.g. residential or non-residential).

One of the most important issues when looking at supplier shipment strength is to track this over defined time periods, and then adjust these values on a rolling basis each quarter.

In this regard, the next step in the analysis is to look at the trailing 24 months (t24m) of data within each subset above. Looking at a two year period at the end of each quarter (eight quarters, 24 months) turns out to be of greater value than a specific quarter; or indeed any 12 month or calendar year period which is not long enough to smooth out any short-term abnormalities in supply, possibly arising from adjustments to trade-related issues or technology-upgrades, etc.

For each company (i), quarterly CIU shipment volumes by region are summed over the eight previous quarters (t24m period at quarter end), and converted into regional market-shares by dividing this by the t24m sum of the total module shipments (CUI specific) into each of the six global regions. This now provides meaningful market-share information, being quarterly, regional and CIU specific, expressed as:

While the output from the above analysis sheds light on the sales tactics of PV module suppliers globally, it is nonetheless confined to historic activity, which may or may not have significance going forward. Put another way, market-share in any given region is only relevant if strong demand levels are expected in this region going forward. Often, within the PV industry, this is not the case, as has been seen on countless occasions when policies are changed, new governments come to office, or markets get saturated (short-term) with energy supply from renewables.

To understand this better, one can consider Chinese companies prior to 2010 when supply was dominated by module sales to Europe (in particular Spain, Germany and Italy). Policy changes in these countries then meant that historic market-share allocations to Europe were less meaningful going forward. There are many other examples where served market sizes of specific countries/regions have changed almost overnight in the PV industry, rendering legacy sales/marketing efforts as somewhat irrelevant to future company operations in this region/country.

This proved to be a critical part of the overall manufacturing supply rankings analysis. To address this, it is necessary to use two scaling factors applied to the regional market-share data obtained earlier.

The first scaling factor considers the total future CIU market demand (Dem) in each of the global regions considered, as a percentage of the overall total global CIU demand, two years out at the end of each quarter, shown as forward-24-months (f24m) to be consistent with the historic (t24m) terminology.

The inputs here are among the few qualitative data entries within the overall studies, to the extent that the data is based on forecasted demand (module supply) two years out for any given quarter. Obviously, when looking at any historic data more than eight quarters in the past, the data moves from qualitative to quantitative since the f24m entries have already occurred. The first scaling factor can therefore be expressed as:

The second scaling factor is equally important, and it is here that end-market risk is introduced. This is critical to understand since end-market regional policy or similar demand-related market factors create risk to future deployment. Any market-related issue that introduces risk to demand has to have a direct impact on the value of any legacy market-share coverage (shipment volumes) of any module supplier into that region.

This is done by assigning a demand-specific risk factor (Risk) by quarter/region, based on the f24m period at any given time. The resulting scaling factor is therefore expressed as:

Through this analysis, supply scores are assigned to all module suppliers at the end of each quarter; for CIU deployment into each of the six global regions considered; based on historic market-shares (ratioed against t24m global CIU demand); and scaled against future (f24m) regional CIU demand and associated demand-risk/uncertainty at the regional level again.

The final score for all module suppliers (by quarter-end) is then the sum of the scores for each of the regions, and can be expressed as:

The scaling factor k is used to put the scores in 0-10 bands, and is set quarterly by looking at the overall distribution of scores and standard deviation values each quarter. This allows the relative manufacturing supply strength of any company to be understood each quarter, benchmarked against other companies.

It should be noted that if just the historic terms are summed up (t24m), this yields module shipment rankings by shipped volume only. If the t24m period is then changed to 12 months (ttm), and the point of reference is at year-end (end Q4), then the output is simply the annual module tables, routinely cited by industry observers, but confined in this case to the CIU segments (i.e. non-residential).

Manufacturing supply (S) strength score output

Aside from the manufacturing supply score (S) that forms one part of the overall manufacturing health score (M), there is a wealth of output metrics that arises from the analysis above. However, the main objective here has been to score all PV module suppliers based on the strength of supply going forward, and to benchmark companies with one another over time on a common 0-10 band/scale.

The graph below shows the supply scores (S) for the top 50 module suppliers (by volume) within the analysis, with the t24m periods fixed in this case at the end of each calendar year from 2014 to 2019 for ease of display. Therefore, the 2019 scores should be indicative of the industry as seen today (July 2019).

To help illustrate the value of this analysis, four companies are highlighted in the graphic, characteristic of changes seen within the six-year period illustrated in this case. The companies chosen here are JinkoSolar, First Solar, LONGi Solar, and Yingli Green.

The trending fortunes of all PV module suppliers can be understood by looking at the relative t24m scores, whether at calendar year-end (as in the above graphic) or during the year at each quarter-end. The four companies highlighted above serve to illustrate this statement.

Going bottom-to-top in the list of highlighted companies, Yingli Green (a previous market leader) has seen its manufacturing supply strength collapse between 2013 and 2019, despite the company still being a multi-GW module producer. While shipment volumes have been falling in recent years, the decline is mainly coming from overreliance on one regional market (China) that has been subject to various policy and future-demand risk factors over the past 18 months.

LONGi Solar’s supply strength profile is coming mainly from increased module shipments since 2014, with the current upward trend also driven by having a more global end-market reach (that by default helps to smooth out any country/regional specific demand risk).

First Solar’s profile in the graphic above illustrates the impact of having a broader (non-China) end-market supply split, while staying away in recent years from high-risk regions such as India, coupled with greater volumes available from production with new capacity.

Finally, JinkoSolar’s trending and scores (in particular from 2016) illustrates just how dominant the company has become within the industry over the past 2-3 years. Aside from having the greatest shipment volumes recently (by quarter, calendar year or t24m period), the delta between JinkoSolar’s supply score and all other companies is coming from the focus on high-growth, and low risk regions. This is explained in part by the company diverting shipments away from China and India for example during 2018/2019.

JinkoSolar’s leading manufacturing supply strength status is therefore further evidence that companies increasing module shipment levels need to be ahead of the curve in terms of the end-markets that sales/marketing efforts are assigned to, and not simply grabbing market-share in areas that have limited long-term strategic growth potential; more on this topic across the six articles making up this series.

Finally, it should be pointed out also that the methodology above can be adapted to be end-market specific, revealing the strength of supply for all companies into certain regions, at any given time period, and can be used to model the effect of abrupt policy/political changes in the future.

Previewing the next part of the article series

The next article in this series will focus on the middle term in the manufacturing health score analysis; capacity (C). This incorporates the value of module capacity available in-house to each company (segmented by in-house and third-party cell supply) across eight different global manufacturing regions; and how this allows certain companies to be well positioned to navigate trade-related issues based on module (and cell) origin-of-manufacture.

Attend PV ModuleTech 2019 to hear the first presentation on the findings

The full results of the overall study will be released by the PV-Tech market research team before the end of August, with the key findings presented, explained and discussed in the 45 minute opening talk I will be giving at the forthcoming PV ModuleTech 2019 event in Penang on 22-23 October 2019.

PV Tech’s bankability analysis series links are below

Part 1. PV-Tech research set to reveal investment grades for global PV module suppliers

Part 2. PV-Tech research reveals how to assess PV module suppliers’ capacity claims

Part 3. PV-Tech research establishes technology-leadership scorecard for top-100 module suppliers

Part 4. PV-Tech research reveals ranking tool for manufacturing strength of global module suppliers

Part 5. PV-Tech research ranks PV module suppliers by financial health

Part 6. First PV module supplier bankability ratings tool created by PV Tech research team

Read the entire story

PV ModuleTech 2019 speakers to explain trends in bankable, quality & high-performance modules

The agenda for the forthcoming PV ModuleTech 2019 conference, to be held in Penang, Malaysia on 22-23 October 2019, has just been announced by PV-Tech, and can be viewed on the Agenda ‘tab’ through the link here.

Once again this year, PV ModuleTech is shaping up to be the go-to event to learn which module suppliers are the ones being consistently chosen for large-scale global PV projects. The event is now firmly established in the PV events calendar, and the session topics reflect the new trends in module assembly, factory auditing, inspection and related due-diligence studies.

This article reviews the topics and speaker line-up for PV ModuleTech in October 2019, and highlights key issues that attendees can expect to understand better, ultimately leading to more informed decision-making by global EPCs, project developers and asset-owners.

Opening talk to reveal much-needed module company health rankings

In the past couple of years, I have tended to limit my own contributions on-stage to moderating most of the 2-day event, while adding various inputs as and when needed.

This time around at PV ModuleTech 2019 – and in recognition to increasing concerns raised by asset owners and investors today – I have decided to deliver the opening talk at the event. The extended 45 minute presentation will effectively outline the results of a five-year period of in-house research at PV-Tech across more than 100 leading PV module suppliers.

The scope of the talk will be based upon detailed analysis that considers the key factors underpinning module supplier and technology choice for global PV projects within the industry today, and going forward; and crucially, how investors and developers can properly assess which companies have the lowest risk profile.

Leading module suppliers on show with latest module technologies and field data

A key part of PV ModuleTech is to have content and technology-led presentations by the major global PV module suppliers, which represent a small percentage of the 300-plus module makers that exist in the PV industry today.

In fact, it remains true that when module selection for institutional-driven PV projects are considered, there are only about 10-20 module suppliers that end up on any given buyers short-list. As the projects get larger (100MW plus), then the grouping shrinks to below ten normally.

Indeed, many of the companies showing on various ‘Tier-1’ lists have never supplied any meaningful large-scale PV projects, and may never, due to limited capacity availability or to a fundamental limitation from an investment-risk perspective. The PV industry really needs to move to a far more sophisticated and meaningful metric urgently.

The module suppliers speaking at PV ModuleTech 2019 this year are from the 10-20 large-scale providers of global PV projects today, including JinkoSolar, First Solar, LONGi Solar, Hanwha Q CELLS, Risen Energy, Talesun, Jinergy and Seraphim.

With the audience at PV ModuleTech 2019 largely comprised of decision makers from downstream segments (developers, EPCs, investors), it is therefore hugely important that module selection processes use current metrics from the top 10-20 module suppliers, in addition to knowing what is likely to be supplied by this grouping going into 2020.

Talks from the above-mentioned module suppliers feature across the two days of PV ModuleTech this year, with bifacial supply again being a hot topic for the conference, as explained more below now.

Bifacial modules; the road from curiosity to niche to commercially-practical

As soon as rear side Al-BSF passivated cells were phased out of the industry by the so-called PERC method, bifaciality (by way of rear-side availability for light absorption) simply became a natural option for any PERC-based product. Indeed, the only thing that has held back every module being double-sided (or bifacial) was the established backlog of monofacial (and often low-cost p-type multi modules) already being specified for global projects.

Bifacial also came at a time when project economics was seeing a massive boost purely from ASP erosion, and the investment community was more than happy to have IRR’s met through an established, low-risk offering (as p-multi has been for the past decade).

However, once PERC became the 100 GW manufacturing capacity segment it is today, bifacial product was then seen as something that could only boost site yields (and IRRs): the only question being how much, and show-me-the-data!

Over the past couple of years, sessions at conferences and workshops on bifacial module technology have tended to be somewhat academic or aspirational-led, broadly characteristic of any niche market offering. Often, downstream companies have left with more questions/worries than they had in the first instance!

With two years now of projects (some tens of MW in size, or more) globally, and the unexpected (but most-happily-received) windfall arising from the 2019 US Section 201 exclusion for bifacial imports, bifacial is set to be everywhere in 2020, even on residential rooftops where the advantage is next-to-zero!

The industry in the past was happy to use generation models that had tilt and latitude/longitude inputs, alongside degradation forecasts, as a means to predict kWh/kW outputs. Many of the models for this were desktop study driven, and essentially ran off datasheet numbers. However, when the surface is a factor (as of course it is for bifaciality) then this type of computerised modelling stops.

The replacement has yet to be established within the industry, and the questions continue to come from site investors and asset owners in terms of how to model accurately bifacial yields over the lifetime of the investments.

This neatly frames the bifacial session focus at PV ModuleTech 2019, with many module makers now able to show meaningful field data over a multi-year time period. The conference will also feature key findings by the likes of NREL and PV Evolution Labs, in terms of field performance and reliability testing.

Manufacturing quality still dependent on production equipment, material-choice and third-party agency approval

Another major part of PV ModuleTech involves the contributions from factory auditors, test/inspection/certification bodies, and independent engineers. In fact, the event is now the only global PV event structured around the contributions from these organizations.

Sitting in the middle of the value-chain between module producer and site investor/builder, these third-party agencies are the stamp-of-approval for large-scale PV investments in terms of checking the product, the manufacturing processes and the shipped modules.

Speakers from Clean Energy Associates and Kiwa Group are among several that will be on stage at PV ModuleTech this year.

Module equipment and material availability continues to see advance

Increased throughput of higher-efficiency modules has been a key feature of the PV industry in the past few years, and this is often coming from the use of more advanced production equipment and material selection.

Contributions will be provided this year from Meyer Burger, 3M, DuPont, DSM and Mondragon, with a focus on new innovations that will see first market introductions during 2020.

Technology-transfer still a key enabler for Asian module fabs

Getting new module-based processes into mass production for many of the Asian PV producers still relies upon successful technology-transfer projects. Research institutes have been featured heavily at PV ModuleTech during the past couple of years, with many likely to return in 2019 such as CEA-INES based in France.
Still options to contribute to 2019 PV ModuleTech agenda

With 3 months left until the event in Penang on 22-23 October 2019, we are in the final stages of firming up the remaining topics and speakers for the event. Anyone wishing to offer contributions or sign up to attend (our early-bird rate is open until the end of this month, July 2019), should contact us ASAP through the options at the event website here.

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PV industry benchmarks for module technology and bankability are driven by JinkoSolar

The PV industry roadmap – and related metrics of technology and bankability – are now being driven by leading module supplier, JinkoSolar, with others seeking to replicate Jinko’s product line options, trying to differentiate in markets that are receptive to low-cost alternatives, or focusing only on rooftop markets where volumes are lower and sales/distribution efforts are more intensive.

That a leading industry supplier should be setting trends for others to follow may seem rather obvious, but this is the first time it has happened in the PV industry. In previous growth phases, groups of companies sought to maintain a status-quo approach to technology-change, or put so much effort into being number-one for shipments that fiscal diligence was overlooked and came back to hit cash-flows and ongoing business concerns.

The article explains how the current landscape – in which one company is not only dominating supply volumes, but also driving the technology roadmap of the industry – has come about, what this means for global technology and supply offerings for the next 12-18 months, and what other companies are having to do in order to remain competitive going into 2021.

The data and analysis shown is taken from the most recent (June 2019) release of the PV Manufacturing & Technology Quarterly report. The topics and scope of the discussion is also shown to be integral to the forthcoming PV ModuleTech 2019 event in Penang, Malaysia on 22-23 October 2019.

The article also addresses some of the key issues impacting the industry during 2019, including module bankability, bifacial supply, and issues that are ultimately holding back n-type share-growth in the industry today.

JinkoSolar’s multi-to-mono transition close to being complete

There have always been companies in the PV industry that chose to focus on using only mono wafers (either n-type or p-type), either through cell technology selection (HJT or IBC), or as part of a rooftop-only niche product offering to the market.

In recent years, LONGi Solar moved from being a mono ingot/wafer maker to having multi-GW cell/module capacity, and sought to create a brand image whereby mono-only was the strategy, matched with a long-term expansion roadmap that remains loyal to its mono dedication.

However, until a few years ago, multicrystalline ruled PV, with market-share levels of more than 70% typically, and even higher when filtering out non-rooftop and non-China based deployment. In fact, all the module supply leaders of the past decade (with the exception of First Solar) were multi-advocates, and saw ongoing market-leadership status being sustained by the technology type.

JinkoSolar was the first market-leader that got to number-one status (on the back of being one of the me-too multi panel suppliers), and then moved from supply-leader by volume to technology trendsetter. This is something that companies such as Sharp, Suntech, Trina Solar, Yingli Green did not achieve, in part due to erroneous investment decisions but also because the climate for technology-change was not a recognized concept within the industry then.

Indeed, while each of Sharp, Suntech, Trina and Yingli has various forms of backward integrated capacity (mainly across ingots and wafers), there was certainly no plan to collectively change all stages in order to have a new type of ingot-to-module capacity base feeding through to higher specification module supply. This is one of the things that differentiates JinkoSolar, as will be discussed in more detail below.

First, let’s look at JinkoSolar’s in-house cell technology changes, and compare to the industry as a whole (actual cell production). This is best done by looking at the seven-year period from 2013 to 2019, splitting out technology by c-Si/thin-film, p-type/n-type, and Al-BSF/passivation process flow variants. In the graph below Standard is Al-BSF, and Advanced is PERC.

It should be noted that while there are many other technology variants promoted by different module suppliers (half-cut cells, shingled-arrangements, bifacial, etc.), the basic cell types used for all modules should still be grouped (process-flow mandated) into the three simple segmentations outlined before.

The key issue from Jinko’s perspective was to make the multi-to-mono move as soon as it became clear that mono ingot production was becoming a China-based commoditization, and no longer a capacity-constrained and cost-limited low-throughput offshoot of modified semiconductor pullers using equipment made in Germany or Japan.

As soon as LONGi established its first few gigawatts of made-in-China ingot pulling capacity, the dye was cast. This was made even more evident when Zhonghuan joined in and the two companies here set up multi-GW per-annum mono puller additions, almost irrespective of what was happening in the market, with pricing or non-p-type-mono cell proponent. (It almost seems that, like the country as a whole, both companies had a 5-year plan that was not for changing.)

For every c-Si cell maker, either you could sit back and watch the technology-revolution happen (which most did) and enjoy periods when wafer pricing was attractive, or decide to be a front-runner by making the necessary move to mono.

Those that decided to change cell lines (and by default have more mono module supply options), through moving to mono-PERC and having a route today to being competitive in 2020 with bifacial mono-PERC, have been fully vindicated. However, this alone is not enough, and can be seen still as reactive in nature.

The problem with companies that made multi-to-mono moves (or indeed almost every company that made investments into n-type cell lines in the past few years) is that they are completely beholden to LONGi and Zhonghuan when it comes to wafer supply.

Many still view China-solar majors (especially those making polysilicon/wafers) as being somewhat cartel-like (different corporate entities collectively plotting what the landscape looks like to the benefit of one another): therefore, if you want to be a global module supplier and have control over your full cost structure, you cannot have something as important as wafer supply/cost/quality being outside your direct control.

Today, almost every mono-based module supplier is in this predicament. In fact, things get more complicated when the main mono-wafer supplier is itself a company seeking to be a leading global module supplier. When this set of conditions applies, normally there is not a happy outcome for all parties concerned.

Perhaps more relevant then to being a technology-leader is putting in place a c-Si value-chain (ingot-to-module) that is low-cost, high-efficiency mono-based, and this is what JinkoSolar has done in the past few years, and is the only company to make this move. The graphic below shows metrics supporting these changes for JinkoSolar, with Jinko moving towards 100% in-house mono wafer supply during 2020. As part of having a fully-controlled in-house manufacturing supply-chain, this move is highly significant, and allows Jinko to have control over issues such as wafer quality, size (dimensions), thickness and (most importantly) cost/price.

Other factors to be a leading bankable utility-scale supplier

Until now, within this article, I have not mentioned anything to do with capacity-location (origin-of-manufacture), sales/marketing channels globally, or having the foresight of wisdom to diversify supply allocations to avoid the perils of being locked into a short-term bonanza occurring on your doorstep.

Now let’s explain these, and show that being a supply and technology leader in the PV industry needs to have the above issues in place and working effectively.

Manufacturing capacity location is the single most critical factor for any Chinese module supplier, in terms of being able to deal with any tariff-related issue that is at play today, or may happen in the future. Simply put, having China-only cell/module capacity (ingot/wafer is not relevant) is a fundamental roadblock in terms of being a global module supplier. There are options of course, in terms of supplying to China and other made-in-China open markets, as shown most aptly today through the strategy of Risen Energy. Otherwise, Chinese-based companies are left to be part-producers and part third-party customers of the Southeast Asia OEM engine.

It is no coincidence that Jinko, and JA Solar and Canadian Solar in particular, have been at the forefront of Southeast Asia owned cell/module facilities, with Jinko being the only company to have a specific cell-and-module owned strategy (as opposed to still relying on OEM cell or module supply channels, or focusing mainly on either cell or module capacity overseas).

Sales/marketing acumen is directly related to having a successful diversified module channel outlet that allows strong market-share allocations to be achieved in every key utility-scale region of the PV industry. Historically, this has been one of the hardest challenges for all Asian-based module suppliers, not just Chinese. 

Being brand-recognized globally (especially for non-residential PV deployment) is something that most Japanese and Korean companies (with the exception of Hanwha Q-CELLS) largely failed to achieve, and only a small number of Chinese companies have come close also.

Only Trina Solar, Canadian Solar, JA Solar and JinkoSolar have managed this, with Jinko and Canadian today being the front-runners. Others are left to win business (at least for major utility-scale projects) by aligning with parent-owned project-financing (such as Jetion), putting cash up-front with local JV partners or funding vehicles (such as BYD and GCL-SI for example), or playing in cut-throat markets that most wish to avoid at all costs (such as India).

While every Chinese module company has spoken about wanting to be a global player, and seen as a quality supplier while investing heavily in technology, only four companies have managed this: Jinko, JA Solar, Canadian and Trina. 

However, only Jinko has taken this to a non-Chinese based extreme, by basically setting out a goal a few years ago to get Chinese market shipments to single-digit percentage levels at all costs. China has over 100 module suppliers today that have no option but to sell domestically; this is not a good market to be reliant on while global-stage credibility is the ultimate goal.

Does Jinko now hold to key to n-type as a viable contender?

Following through the rationale that the leading module supplier is the technology trend-setter today, it would therefore make sense that any major changes to module technology type would be driven mainly by this company.

This frames nicely the dilemma within the industry over the past few years, where we have companies with limited market-share, heritage in manufacturing, and global strategies being the ones advocating the not-insignificant move from p-type to n-type as a mainstream contender.

The parallels to the a-Si/uc-Si and CIS/CIGS investments a decade ago are evident, with many of the companies announcing n-type investments (this time largely China based) have little or no in-house expertise, and are relying almost entirely on know-how of equipment suppliers. The China example for n-type is even more precarious when the equipment suppliers of choice are themselves China located.

Similar to a-Si/uc-Si and CIS/CIGS thin-film variants, there is no doubt that n-type cells can be made in mass production and high-volume. The problem though is not one of efficiency potential (as it was in part for a-Si and CIGS), but cost and ease-of-manufacture. Indeed, the question of in-house technology-ownership is now more pronounced than ever before in the PV industry; a fact made clear by Jinko’s move to have in-house control of ingot/wafer and cell technology leadership and not dependent on third-party wafer or cell suppliers.

If n-type is to challenge p-type for non-residential/small-rooftop applications, then a global market-share leader has to prioritize the change; this is not happening today other than marketing-related press releases to convey R&D profiles to the outside world.

It may simply be the case that, if Jinko and others (JA Solar, Canadian, LONGi) choose to ignore n-type, and focus purely on a continued efficiency/cost roadmap for p-type mono PERC bifacial variants, then n-type ends up moving from niche (today) to firmly-on-the-backburner (next 2-3 years).

In contrast to previous thin-film differentiated investments of the past however, n-type cannot be discounted, as it still offers the only route to higher cell efficiencies. But the best technology is not necessarily the market champion (think Betamax and VHS video recorder analogy here).

PV deployment is an LCOE/return-on-investment based proposition, and module costs are now a small part of site capex with other factors (mono-facial versus bifacial) way more important today compared to p-type or n-type module offerings. End-markets are being created on a subsidy-free basis also, without the requirement to make any radical technology-driven change in GW-scale manufacturing plants. GW-scale module suppliers are also trying to navigate still-changing trade-based conditions, while holding gross-margins at acceptable double-digit levels.

Logic would therefore support the continued focus on p-type, and this is what we are seeing today. However, if Jinko (or one or two of the other top-5 module suppliers) were to change plans, things would move very quickly as others rushed to stay competitive. But with scales of manufacturing now at the 10GW-level, the barrier-to-entry from any disruptive offering is way higher than it was in the days when GW-scale was the de-facto measure of global supply leadership.

Anyone needing to know exactly what is really happening in technology today – across the top-100 leading global module suppliers – can access this in PV-Tech’s PV Manufacturing & Technology Quarterly report, though this link.

Ranking bankable module suppliers must have a robust ranking metric system

The evolution of the PV industry in 2018/2019 is also highlighting some other major gaps in bankable module supply for investor-driven projects. These type of projects are now the driving force of PV (utility-solar), but the industry is still using rather misleading metrics to rank module suppliers as credible and reliable.

Many companies are still using Tier-1 lists. However, there are typically 35-40 companies ‘claiming’ to be ‘Tier-1-status’. But, for utility projects globally, there are rarely no more than 10 companies (max.) ever considered as bankable. So something is not quite right here it would seem.

Essentially, the Tier-1 lists use quantitative judgements based on somewhat tentative qualifiers, and often lack any systematic methodology that is explained clearly to the industry as whole. Indeed, some Tier-1 lists show the companies by some sort of manufacturing qualifier, such as Annual Module Capacity, often rounded to the nearest GW or 100MW band. Is this nameplate or effective, in-house used or OEM-assigned? Is this using in-house cells or outsourced? In fact, are the numbers even real?

At the forthcoming PV ModuleTech 2019 event in Penang, on 22-23 October 2019, researchers from PV-Tech will be outlining in a series of talks a new ranking methodology that will finally provide utility solar investors with a robust tracking system, upon which to make risk-free investments when choosing module supplier and technology-type deployed. More on this, on PV-Tech, in the coming months.

PV ModuleTech 2019: the must-attend event for global developers, EPCs and asset owners

During the past few years, PV ModuleTech has become firmly established as the leading global event to understand which module suppliers are going to be dominating the global utility-scale deployment stats over the next couple of years.

Only the leading module suppliers are on-stage outlining product availability, volumes on offer to different global regions, and the module technologies that are optimum for each market and site application. Supporting these talks are the leading module materials and equipment makers, providing key indicators for module assembly enhancements likely to flow into mass production next year and how these improvements will increase module performance, quality and reliability.

The other main company category of speakers comes from the important segment that includes factory auditors, independent engineers, and test/inspection/certification labs. The speakers here are often the ones that satisfy due-diligence needs of investors.

In addition to the request from many of the past attendees for a new and robust module supplier/technology ranking system, the other big request for PV ModuleTech this year is to have more detailed presentations and discussions on bifacial modules. Bifacial modules are not a novelty offering anymore, and there is a strong need now for a fully commercial-oriented discussion platform, as opposed to the research-institute led forums that were important to introduce the basics to the industry as a whole.

There are still many ways to participate in PV ModuleTech 2019; please get in touch with us using the contact information at the link here.

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Increased solar module choice needs investor approval before adoption – PV ModuleTech 2018

Choices, choices and more choices; this is the reality facing anyone hoping to procure solar modules over the next few years as the PV industry looks beyond its traditional trappings of 60 or 72-cell aluminium back-surface field (Al-BSF) based cell technologies. As if the array of new module offerings was not already bewildering to developers, EPCs and investors, the chances are it will be even more so in 12 months time as yet more innovations are presented to the sector, according to Finlay Colville, head of research at PV Tech & Solar Media. That is unless independent engineers (IEs) and third-party labs manage to reach consensus quickly not just on how to evaluate the latest technologies, such as bifacial or half-cut cells, PERC, HJT and n-type, to name a few, but also how they perform in specific conditions and on different mounting systems like trackers.

It was with this atmosphere of excitement mixed with uncertainty that PV ModuleTech kicked off for its second year, this time in Penang, Malaysia, with the whole value chain of the industry trying to come to terms with the newest module products. Traditional technologies look set to stay in play for a while longer, however, wherever cost or wafer supply remain constrictive to the spread of newer modules. Moreover, one key question was whether a standard 72-cell p-type multi-crystalline module is at present the only bankable module in the world, being the only relevant product to have had 20-plus years in the field.

Nonetheless, it wasn’t all rosy for the tried and tested technologies, with some shocking statistics presented about variability in solar panel supply. For example, Michelle McCann, partner at test lab, PV-Lab Australia, showed that when manufacturers knew their product coming into Australia would be examined, tests showed modules performing generally at or above nameplate power. However, when manufacturers did not know their product would be tested, deviation from nameplate power was far more variable, with up to 12% less power than billed in the worst case.

“We do get good product in Australia; we just don’t always,” added McCann. “Manufacturers can and do choose where to ship certain product.”

It seems the trick is no longer just about what you buy, but also the way you buy.

Indeed, Lawrence McIntosh, another partner at PV-Lab Australia, showed evidence that product from the same tier-one supplier going to two different customers in the same country can often have significant variation in performance tests. The findings harked back to this time last year when we covered the inaugural PV ModuleTech 2017 conference in Kuala Lumpur; from which the takeaway phrase was ‘all modules are not created equal’.

Scrutinising bifacial

However, the overriding focus this year was grappling with the whirlwind of new technologies. One of the major questions facing the industry is how, when and whether to adopt bifacial modules, because if bifacial were to become the industry norm it would force all EPCs and plant designers to completely rework their assumptions about how to optimize site yields over 20-30 years. Many procedures that are standard to monofacial module installations are turned upside down by the bifacial concept given its ability to generate power from albedo on the ground on the backside of a sun-facing module. A whole new game in terms of Balance of System (BOS) would need to be played.

IEs and certification bodies all showed their work on bifacial testing so far, but it seems that a benchmark test for bifacial has eluded the industry and as one delegate put it “the industry is really excited but confused about bifacial technology”. While there is puzzlement and risk-aversion, there are also early adopters taking the sector into unchartered territory. Offering one of the more bullish forecasts on where bifacial will be in 12 months’ time, Paul Wormser, VP of Clean Energy Associates, reminded us in the final panel session that some players are starting to invest in and install hundreds of megawatts of bifacial modules already.

“We are going to see not just the data coming from the test labs and the pilot sites, but we’re going to empirically see really big projects going in the ground now,” said Wormser. “It’s going to accelerate and so we’re at the tipping point and I think when we come back here next year it’s going to be the normal thing to do.”

This suggests that some players have done their due diligence and fully trust this technology, having moved on from the pilot phase. Of course, only time will tell us how performance will be out in the field.

Colville noted a tendency in the solar industry for innovations to either vanish or become almost universal very quickly and this is why everyone in the sector needs to watch closely if bifacial starts catching on.

Another suggestion that bifacial technology simply cannot be ignored came from Helen Zhou, module technical director at China-headquartered manufacturer JA Solar, who said the firm would soon start only producing bifacial cells and even putting them in monofacial modules due to the prices coming down so far on bifacial cells…This was certainly food for thought.

Multi not dead…yet

The issue of multi vs. mono is still a huge question given that these technologies account for roughly 90% of the market still.

The rise of mono PERC modules has been undeniable, perhaps symbolised by some players in the aggressively price-obsessed Indian market starting to come to terms with it.

For Colville the global market is utterly dependent on wafer supply now and he went as far as to suggest that if there was enough mono wafer availability to supply the whole market today, then “multi is dead”. However, wafer supply constraints mean multi should still be supplying multi-Gigawatts over the next three years and can still utterly dominate specific markets, with some Indian players, for example, likely to be procuring multi right up until the last standard polycrystalline module comes off the production line for an extremely low price in a few years’ time.

In his analysis of the event, Vinay Rustagi, managing director of consultancy firm Bridge to India, aptly wrote: “There has been a common perception in India that solar industry is highly commoditized with multi-crystalline modules accounting for over 98% market share. But these modules are turning obsolete – worldwide share has already fallen from over 70% in 2015 to less than 50% now.

“As for the developers, there seemed to be a feeling that their job is becoming difficult in trying to evaluate different technologies and picking the right one. Some developers mentioned that they have to run as many as 30 different project design combinations before settling on a final plan.”

What and when to pick

Indeed, Frank Faller, VP Technology, 8Minutenergy Renewables, one of the largest solar IPPs in the US, said that not only is p-type multi “disappearing” but there are easily 15+ technology options for modules and the trend is increasing. This dramatically increases the number of modelling iterations the company has to run to optimise its projects. This has made predicting the LCOE of a project more complicated and performing due diligence both more difficult and strenuous.

Faller also said that from a general developers’ point of view, degradation modes on panels are still not fully understood, particularly as “degradation modes depend on the BOM and components and are unique for each single PV module brand and mode”. He also described the finding that quality varies even between different workshops of the same manufacturer as “quite disturbing”.

A major difficulty is how to instil confidence in developers that in six months time the frontrunner technology won’t completely change again, added Colville. The speed of technological progress means a newer, better module could be around the corner just three months into a project that takes 18 months to build, so how does one factor that into LCOE calculations?

“Everyone thinks it’s great that there’s all these higher performing modules and all this extra capability, but actually that’s a problem if you are trying to develop something and have a fixed plan that you are giving to investors and demonstrating what the returns are going to be for 20 years,” he said.

Besides the wafer supply issue already discussed, downstream growth will also play a key role in deciding the future of p-type multicrystalline. Colville said that if the market suddenly needed an extra 40GW next year, it is multi that would supply that demand, simply because there is not enough mono.

However, he added the caveat: “In a world of low-cost mono you have got the sky in terms of what might happen next. You have to deal with change quickly because in 12 months time or in 18 months or two years there could be a rapid transition to tens of Gigawatts of heterojunction (n-type) and then everything changes again. So maybe this is actually a warning time in the industry that it’s just different now, that the industry and the cell processing have moved and we’ve got low-cost high purity wafers coming through for the first time.”

Solar Media’s cell technology-focused event PV CellTech will also be held in Penang on 12-13 March 2019, and the inaugural India-focused event PV IndiaTech will be held on 24-25 April 2019.

Bouncing back from 531

China’s policy upheaval in May this year, that significantly cut the industry leader’s projected growth, sent shockwaves through the industry, however, this week saw news emerge that the Asian giant may be considering enlarging its overall solar target to a huge 250-270GW by 2022. This will be sure to affect the rising demand from the rest of the world across Southeast Asia, Latin America and the Middle East, which have been absorbing the surplus capacity in China caused by the 531 announcement.

The resulting decline in ASPs has caused the whole industry to squeeze. Colville said this decline is entirely due to the supply of polysilicon and wafers, which is controlling both technology and pricing  – adding: “The pricing of modules in the last few years has been held relatively high you’ll be disappointed to hear if you’re a manufacturer.”


Declining ASPs of course puts pressure on manufacturers to increase energy yield while also decreasing costs.

“The gap between the ASP and module cost is quite small and this is a huge pain for all of us in the industry, which means nobody is really earning money,” said Mirko Meyer, head of product management, at major equipment supplier Meyer Burger. “So then the question is how can we overcome this? Of course we can reduce module costs but this is hard without suffering on quality. The whole industry is squeezing and quality becomes a pain.”

To make matters harder, Colville also added that a rebound on prices is very unlikely anytime soon.

“There’s not a lot of margin in module manufacturing especially after China 531,” said Tristan Erion-Lorico, Head of PV Module Business, Laboratory Services, at quality assurance and risk management company, DNV-GL. “People are getting squeezed, but for the most part they are surviving, but if they are not getting a healthy margin to survive then cutting corners is an inevitable thing to turn to rather than closing the company down.”

Quality was indeed a major feature of PV ModuleTech and we heard throughout the conference a long list of problems including underperforming modules, poor quality backsheet choices, replacement of modules after only a few years, and micro-cracks, to name a few.

For example, due to many first-time Indian developers entering the market during the “gold rush” of 2014/15, Vinay Rustagi said: “There is a big problem in India that many projects don’t have the necessary amount of quality focus that they should have had. Many projects we know are underperforming very badly. There is high module degradation, there are warranty problems being reported etc.”

Sudeep Tiwari, senior manager, PV Module technology and Supply Quality at Indian developer and EPC Mahindra Susten, said the firm has been actively taking a stand over quality before signing contracts and looking at BOM very carefully, perhaps marking a steady change of habits in India, and Rustagi said quality is likely to even out over a period of time with the industry consolidated and new government-led quality standards being introduced, but it will remain an issue for another 1-2 years.

However, besides emphasis on price, many delegates noted the importance of third-party labs and IEs having a strong voice for the industry to rely on.

Lou Trippel, vice president of Product Management at US-based thin-film solar manufacturer and developer First Solar, said: “In terms of energy prediction – these things are hard enough without even considering some of the biases that may be present. We end up with a bit of an arm wrestling match here and we luckily have some referees that can jump in. As an industry we need to recognise the importance that these independent roles play in trying to drive toward that level of unbiased and absolute correctness.”

Fabian Wany, head of sales EPC, SEA, at developer Conergy, also said it was easy to be “puzzled” by all the module innovations on offer – adding that the firm had been lucky over the last few years to build projects using either mono or multi modules and then simply having to work out the best radian, structures and cables. However, now “everybody is getting into a panic”, worrying about missing out on the latest trend and extra energy uplift that it could yield for a project.

Wany added: “The precedence of the tech is not there yet. We need more evidence in order to trust the data. Some people have tried their luck and tried to make it work and that’s helpful for the industry to push forward, but essentially we need more third-party certification.”

Bankable bifacial

Ralph Romero, senior managing director, Black & Veatch Management Consulting, which plans to introduce the industry’s first bifacial module rankings through tests in the Nevada desert, said: “In the US, there is a lot of excitement about bifacial modules, but the reality is there is still a lot of uncertainty with regards to module availability and module quality and first and foremost is the lack of a widely accepted energy forecasting tool for bifacial module performance. That’s probably the single most significant limitation today that I see in the US market for deployment of bifacial technology. There are still hurdles to be overcome – it’s not that everybody is now going crazy about bifacial modules; there’s still a lot of hesitation.”

Romero said that B&V’s bifacial tests show on average a 5% module efficiency gain over mono, which is significantly less gain than the 15%+ gains that many manufacturers have touted. He added that the large variability in bifacial forecasts across the industry means that they need to be taken with a grain of salt. Regardless of that, the conference still heard of some developers considering sites of up to 300MW capacity using bifacial modules.

Nonetheless, Romero added: “The reality is that most manufacturers have bifacial products, but not very many actually have high volume commercial production of them.”


Other themes that emerged during the conference were:

  • a strong desire for data on how PERC technology is performing in the field after its rapid adoption over the last year;
  • manufacturers highlighting the increasing importance of working with tracker and mounting suppliers for mutual benefit when designing new modules, especially for example in the US market which is now dominated by single-axis trackers;
  • Light and elevated Temperatures Induced Degradation (LeTID) becoming a hot topic;
  • more types of tests being discovered regularly.

As a final thought, Colville asked a panel if repowering – replacing the entire module selection from old plants with cheaper and more efficient new modules – could become economically viable in the near future. We then heard of potentially Gigawatts of such repowering happening in Italy over the next few years. However, manufacturers said there are Balance of System (BOS) problems when replacing older vintage modules with new ones, because the new module specifications often have different sizes.

Solar Media’s cell technology-focused event PV CellTech will be held in Penang on 12-13 March 2019, and the inaugural India-focused event PV IndiaTech will be held on 24-25 April 2019.

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PV ModuleTech 2018 to grow by 30% as interest in module supply and quality hits new heights

The solar industry, in terms of deployment, will sadly not be growing by 30% in 2018. However, the good news is that the PV ModuleTech 2018 event – taking place in Penang, Malaysia on 23-24 October 2018 – will see more than 30% growth in the number of companies taking part and the number of attendees on site.

The huge uptick of interest in PV ModuleTech 2018 reflects the importance today of module supply and quality, with higher performing modules widely available on the market today, at ever-declining prices.

What’s the catch? The answer is reliability and long-term operation in the field, and how to understand where the risks are in choosing the correct module supplier and respective technologies. This has seemed to be a constantly-moving target in 2018, and has left many developers and EPCs with more problems than solutions, and a wider range of options to choose from.

This article reviews some of the key issues expected to be discussed, evaluated and debated during the PV ModuleTech 2018 event. Having started the PV ModuleTech annual event just last year in 2017, it has in just 12 months now become the must-attend conference in the PV industry to keep abreast of module availability and trends on the global stage.

Under one roof – the global supply-chain and knowledge base for PV modules

The goal of PV ModuleTech is simple. Assemble the leading global module suppliers in a neutral venue (Malaysia), and bring in the leading global test/inspection, auditing/certification and related independent engineering firms and related third-party agencies. And then have as many of these companies on the stage talking real issues for utility module supply to the industry.

Thereafter, the full networking potential of the event is supplemented by having as many of the leading global developers, EPC’s, O&M’s, and asset owners/managers at the event – learning supply options, risks, opportunities, and hopefully pencilling in chosen module suppliers/technologies for large-scale PV project deployment in 2019/2020.

Completing the line-up are the leading equipment/materials suppliers to module assembly factories and research labs and institutes active in module production, testing and market analysis.

The first PV ModuleTech event last year kick-started this dedicated annual forum. The 2018 event in Penang next week (23-24 October 2018) looks set to move things to the next level, with demand for the event outstripping our supply! That is – we have been frantically adding more rows of seats at the back of the hall to make sure everyone can be accommodated.

Now let’s have a quick look at some of the companies confirmed to be at PV ModuleTech 2018. The first listing is for global module suppliers, where you can see quickly that was basically have the ‘full-set’ when it comes to bankable GW-scale global module supply options:

The next category shows some of the test/inspection, auditing/certification and IE companies that are crucial to risk-assessment and bankability studies undertaken for company and technology selection of modules for commercial solar projects.

The other category I have pulled out in this article are the downstream stakeholders (developers, EPC’s, etc.) that represent the buy-side of PV ModuleTech, and the ones that need to understand what modules are available and which ones they should select for site deployment going forward. Some of the companies within this grouping are shown now:

Therefore, looking at the numbers above, while there are well over 200 companies attending PV ModuleTech, by far the largest-represented grouping will come from the downstream (module buying) category.

What will be the key issues debated this year at PV ModuleTech?

If last year is anything to go by, then module supply, quality and reliability will dominate the proceedings. But this year has an added twist, in that we have now moved beyond the multi (poly) domination of modules and what had been predicted for years (more mono, more glass/glass, bifacial, more variety of modules) is firmly in evidence.

In the past 12 months, there is probably not a single large-scale module buyer (from local installer to global developer/EPC) that has not been pitched about 5 or 6 different module technology types. The only thing they all have in common is declining market pricing!

Having each of the options (72-cell multi, mono, PERC, bifacial, n-type, half-cut, multi-wire interconnected, thin-film Series 6 panels) discussed and presented without bias is perhaps one of the most valuable aspects of how we set up PV ModuleTech. If anyone wants one-sided pitches, there are plenty of exhibitions on the PV calendar to choose from!

So, in this respect, I for one want to really understand the performance of each of these options as it related to high-volume bankable MW-level project supply in 2019. There are going to be many large-scale projects deployed in 2019 using each of these options, and this will extend across testing, auditing and inspecting. Therefore, while it is important to know overall market-share trends, the industry is still relying on different module types from a wide range of suppliers that have been shown to be bankable in different countries, regions and climates.

Supporting this is my next key goal: to piece together the different third-party agencies that have developed the skills, know-how and capability to qualify these module technologies. This part of the industry has had to develop new tools, new measuring techniques and advanced processes in order to capture the risk elements across the evolving module technologies and performance attributes. If I was a developer or EPC today, I would want to know exactly who to turn to when any decision on module supplier or technology was being evaluated.

Finally, the role of new module assembly production equipment and materials has also been moving at a frantic pace in the past few years. Increasingly, factory audits and BoM examinations are being done to ensure than 20-30 year IRRs are maximized, and in setting of fair but challenging performance ratios to O&M’s. Many of the leading equipment and materials suppliers will be at PV ModuleTech again this year, and each has a host of in-field data that can be traced back to module assembly stages also.

How to get involved at PV ModuleTech 2018

As one of PV-Tech’s flagship PV technology events, PV ModuleTech 2018 will feature coverage of PV ModuleTech 2018, but this is no substitute for being at the event at all. During the 23-24 October of the two-day event, we have loaded the time with networking activities, through to late evening on each of the days at the location venue (outside ideally, indoors if monsoon rain and thunder prevails!).

When I last checked earlier today, we have about 15 available seats still left in the extra capacity we added in the hall at the start of this week, so still time to be in Penang if you are quick off the mark! Visit the event website here for details on how to attend. Looking forward to the event – expect to hear more from me once the event is over with my perspectives and conclusions!

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Sunrun shifting solar panel selection to high-efficiency p-type and n-type mono

Following-on from our recent analysis of Tesla’s solar panel supply base changing rapidly, the same is true of leading public listed US residential installer, Sunrun. 

The data used to compile this analysis comes from Philip Shen, financial analyst at ROTH Capital and in its basic from, data comes from the California Distributed Generation Statistics, which publishes all IOU solar PV net energy metering (NEM) interconnection data from the three large California Investor Owned Utilities (IOUs) which include Pacific Gas & Electric Company (PG&E), Southern California Edison Company (SCE), and San Diego Gas & Electric Company (SDG&E).

Sunrun recently surpassed Tesla in the US residential market, primarily by default as Tesla continues to restructure its solar operations towards sustainable profitability but Sunrun should gain recognition for maintaining around the double digit deployment and revenue growth over the last several years, despite the residential market flat lining and more market share taken by smaller, regional installers.
Although seasonality plays a part in deployments and revenue recognition, Sunrun’s solar rooftop deployments have increased from 65MW in the second quarter of 2016 to a record 91MW in the second quarter of 2018. 

The same can said of its quarterly revenue figures, which have increased from US$122.5 million in the second quarter of 2016 to US$170.5 million in the second quarter of 2018. In more recent quarters, revenue gains have been offset by lower panel and therefore system prices but boosted by incremental increases in energy storage additions. 

The company noted in its second quarter 2018 financial results that it had added over 12,000 new customers, supporting around a 20% increase in deployments. 

Changing panel supplier base

Like Tesla, Sunrun has been selective in the number of PV panel manufacturers it has used for its residential installations since 2015. 

Previously, around 15% of installs in California used a number of panel suppliers but this was narrowed down to around three key suppliers (REC Group 74% and Hanwha Q CELLS 10%).

However, the chart below shows that Sunrun had drastically shifted away from using mainstream multicrystalline panels from REC Group, which accounted for 74% of deployments in 2015 to only 33% by the end of 2016. 

REC Group was supplanted by increased selection from Silicon Module Super League (SMSL) members Hanwha Q CELLS (33%) and Canadian Solar (29%) at the end of 2016. Both had been mainstream multicrystalline-based panel manufacturers. 

Further changes occurred in 2017. Although the share (2%) is insignificant in the timeframe, Sunrun had started using LG Electronics panels by the end of 2016, although distinguishable for being N-type mono technology, carrying the then niche label of being high-efficiency.
Yet the use of LG panels took a significant turn upwards in 2017, accounting for 26% of California deployments by year-end.
A similar rate of increase was also noted with a surge in panels from long-term supplier, REC Group, which recovered its share to 60% by the end of 2017, up from 33% at the end of 2016. 

REC Group and LG Electronics gains resulted in major share declines for SMSL members, Hanwha Q CELLS and Canadian Solar, both ending 2017 with 7% shares, down from 33% and 29%, respectively from 2016. 

From a PV panel perspective, it would seem Sunrun had further simplified its supply chain, choosing REC Group for mainstream multicrystalline deployments and LG Electronics for high-efficiency deployments. 
However, panel selection trends changed again in the first four months of 2018.

Again, REC Solar’s share declined significantly to an average of 38% of deployments, while both SMSL members, Hanwha Q CELLS and Canadian Solar lost virtually all custom from Sunrun. 

Supplanting REC Solar, Hanwha Q CELLS and Canadian Solar was another SMSL member LONGi Solar, a subsidiary of the largest high-efficiency monocrystalline wafer producer, LONGi Green Energy.

LONGi Solar has started as a new supplier to Sunrun at the beginning of 2018, achieving a 25% average share in the first four months of 2018. 
As the deployment chart (Jan – May 2018) shows, LONGi Solar had become Sunrun’s largest high-efficiency P-type mono-PERC (Passivated Emitter Rear Cell) panel supplier, accounting for 45% of installations. 

N-type mono PERT (Passivated Emitter Rear Totally Diffused) and N-type mono IBC (Interdigitated Back Contact) panel supplier, LG Electronics with SunPower equivalent high-efficiencies had taken a 39% share of deployments by the end of May. 

Once again, REC Group took a hit with its share declining to its lowest level at 13% at the end of May. 

According to the data so far available, Sunrun’s mainstream products are coming from LONGi Solar with its high-efficiency P-type mono PERC panels instead of being P-type multi-PERC based panels from REC Group. 

Although the charts have yet to technically align after only four months of 2018 data, clearly Sunrun has been shifting to high-efficiency p-type and n-type mono panels at the expense of suppliers of multi-PERC. 

There are some obvious reasons for the shift to high-efficiency panels, importantly for balance of system (BOS) costs. Fewer panels are required for a given rooftop PV system, which translates into less racking and wiring as well as short installation times. 

In California you could add higher overall system yield due to the cell technologies being used, coupled to better temperature coefficient factors of mono over multi. 

But not least is the benefit of lower performance degradation rates of mono over multi over a 20 to 25-year life-cycle, further boosting overall yields. 

Another not insignificant factor influencing Sunrun’s panel technology supplier base is its long-standing solar lease business model. Being able to pass-on ownership to the lease holder after 20 years would seem more advantageous when it related to high-efficiency mono panels with less degradation than P-type mono and limits reliability risks on Sunrun. 

Of course with Tesla and SunPower being close residential rivals with high-efficiency panel product offerings, keeping competitive across many business metrics is fast becoming the new norm, most recently highlighted in PV Tech’s recent preview of panels showcased at Solar Power International in Anaheim. 

It is also worth noting that the announcement by LG Electronics that it would establish a 500MW panel assembly plant in the US.

The company is planning to initially produce its ‘NeON ’ series panels in 60 and 72-cell configurations for residential, commercial and utility-scale markets as well as the ‘NeON 2’ series that includes a transparent backsheet that improves residential system aesthetics by blending the roof colour through the spacing of the cells.

This would be a differentiated high-performance module for the US residential market.


A special thankyou to Philip Shen, financial analyst at ROTH Capital for sharing the volume of data gathered and assimilated for PV Tech to produce the data and analysis in this article.

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Multi-GW India manufacturing challenges to be the focus of new PV IndiaTech 2019 conference

During the past few years, we have had numerous requests at PV-Tech from a wide range of PV industry stakeholders (due mainly to the success of the PV CellTech and PV ModuleTech series of conferences) to launch an India-specific PV event in Delhi. The requests have come from Indian companies, overseas investors, government bodies, trade associations, and both upstream/downstream industry activists seeking to understand and drive future developments.

As a result of these requests, and given the key stage Indian PV manufacturing is going through today, we have decided to launch an annual event in Delhi, dedicated specifically to India PV manufacturing. PV IndiaTech 2019 will have its premiere on 24-25 April 2019.

This article discusses the need for such an event, and what the key objectives will be from the conference. More broadly, I outline here also just why any company with global PV aspirations (across the entire PV value-chain) either has, or needs to have, a carefully considered India-PV-strategy plan.

Once you have absorbed all the information, it would be great to get your thoughts on PV IndiaTech 2019, and how we should configure the event with the correct mix of global stakeholders needed to move the industry’s manufacturing forward over the next 10-20 years.

Unique focus on manufacturing that bypasses short-term opportunism

Every country that embarks on a solar or renewables plan does so with lofty ambitions of creating an indigenous manufacturing landscape that results in high-quality sustainable job creation. Conversely, no government wishes to bankroll a deployment gold-rush that ends up being cornered by Chinese imports. Chapters of thesis could be filled simply by solar activities in this regard over the past few years.

For the countries that have sought to impose domestic manufacturing restrictions, whether to bail out domestic companies such as in South Korea and Taiwan or show evidence of token manufacturing efforts by way of module assembly plants, there has been all too often an air of short-termism.

Linking a viable domestic manufacturing sector with a risk-free long-term pipeline needs a government commitment that extends beyond 10 years, and in this respect, we can start to see just why PV manufacturing ambitions within India today are different from anywhere else globally.

But there is much more. India has an embedded goal of being seen on the global stage as a high-quality technology leader, and not simply another Asian country (post Japan, Korea, Taiwan) that has labour costs or a sophisticated OEM-culture as its primary drivers (Thailand, Indonesia, Malaysia, Vietnam). This largely captures the Make-in-India mantra, but for solar there is also the deployment (energy demand) driver that moves things to another level.

Fundamentally, India is the only country today that has a multi-decade forward-looking plan – championed by the current Prime Minister – that covers both deployment and upstream full value-chain manufacturing. No other country comes remotely close to this, with the exception of China (that is barely open for business when it comes to inward investment).

What India wants is a massive challenge

India wants to have a solar manufacturing sector that has the technology-brand of Japan or South Korea, the processing capability of Taiwan, the cost structure of China and the inward-investment lure of Malaysia. And to top it off, the final product performance and quality will allow leading producers to access both domestic needs and export opportunities.

As aspirational as it may sound, if you don’t have those ambitions from the start, you are almost certain to fail. The issue with India though is that we are a long way away from this, when we look at the country’s manufacturing sector today and the ongoing tumultuous relationship it has with its downstream suppliers.

During the past couple of decades, there have been many plans tabled to unleash a multi-GW eco-system value-chain of PV manufacturing. Almost all of these were lauded by eager publicity-seeking activists, but many began and finished at the ceremonial MOU phase, never to be heard of again. Those were the days of polysilicon plants being built or thin-film factories piggybacking on the country’s displays-oriented ambitions.

What finally did emerge in the early days of India solar (that remains until today) can be seen, for example, at Greater Noida (Indosolar) and Hyderabad (then-named Solar Semiconductor), in what were the first purpose-built ‘modern’ cell fabs in the country. In fact, during an early trip to India almost 10 years ago, I remember vividly the pride that India has entered the fab-era.

The start-stop production characteristics of these early entrants, in addition to the never-ending existence of various state-owned loss-making solar business units, seems a long way off, given what has happened in the past few years that starts to paint a picture of what this India-solar paradise may look like if the different stakeholders can make it work.

Government driven upstream and downstream finance

The launch of the National Solar Mission within India changed everything. It put to an end to the notion that pure-play cell production could compete as an export industry. It created a multi-GW end-market that caught the attention of the world. It was inherited by a Prime Minister (Modi) that has no equal anywhere else in the world when it comes to an inherent love of solar and an understanding of how it can transform India as a global leader in a post-fossil-fuel world.

The long-term commitments by Modi for deployment of solar within India serve as the most risk-averse guilt-edged market driver that could be imaginable. Yes, there is downside that accompanies this rapid growth in India, and I will touch on this later in the article. But, either way, any other domestic solar segment globally would readily have this problem in exchange for a constant pipeline of opportunities.

During the past few years, the concurrent upstream drive has come from a succession of attempts to restart domestic cell and module production, through safeguarding, domestic-content carve-outs and the latest Solar Energy Corporation of India’s (SECI) tendering for 3GW of manufacturing linked with deployment guarantees.

Running alongside these policy-driven initiatives, there is of course Adani, and the Mundra-chapter in India-PV, where the multi-sector, multi-national, multi-billion-turnover conglomerate sought to self-fund a micro-solar eco-system at the GW-level.

As of now, none of these efforts has succeeded, and in almost every case (and of course with hindsight) one can easily point the finger at naïve-ambition or a general lack of awareness of technical and commercial factors that underpin the global solar manufacturing sector today.

However, what these efforts reveal is intention, or perhaps a crash-course in PV manufacturing learning that should serve to get it right going forward.

Getting it right

If there was a simple domestic recipe to scale up multi-GW solar manufacturing, spanning ingot/wafer and cell/module production with profitability, there would be PV fabs all around the world, and trade-related barriers would never be heard of. Similarly, if there was a means of curbing global China-export domination, the world would look radically different today.

As such, there is no slight on any of the proponent’s motives, nor should one take apart the flawed assumptions that ultimately led to non-success.

Regardless of the 25GW of solar deployed today within India, and the failure of the previous domestic manufacturing efforts, one should still see India at the start of a journey, perhaps even just finishing its formation lap.

The long-term goal remains intact: being a global PV manufacturing powerhouse, driving domestic demand and having an export-market for any surplus. And critically, there remains the promise of finance through direct government budgeting and inward-investment vehicles including overseas government agreements and energy/infrastructure investment vehicles.

In this respect, there is almost an inevitability that multi-GW PV factories will emerge within India over the next 5 years, but the fundamental question remains: can they get it right?


Finding a route where everyone benefits has to be the solution

Understanding what has to happen in the short-term is inextricably linked to what a successful outcome looks like; and working back to what steps need to happen to fulfil this.

The successful outcome sees many parties benefiting in different ways, but most seeing this through short-term profitability, healthy returns-on-investments or market-favourable asset-values. Other stakeholders – in particular the Indian government and overseas countries that have intrinsic connections – benefit directly and indirectly in terms of global leadership and secondary diplomatic positioning in a renewables-dominated climate.

However, it would appear today that the ingredients for success boil down to a few key issues that need to be resolved:

What stages in the value-chain (for c-Si manufacturing) are of value for Make-in-India? Is it necessary to install ingot pulling capacity or should the focus be firmly on cell production, with matched module assembly capacity?

Which technologies need to be selected today for manufacturing investments that – by the time the facilities are operational – are state-of-the-art in terms of cell efficiencies and panel performance?
How do GW-scale factories get completed in Chinese-based timelines of 3-6 months, and retain the flexibility in adopting any technology-adoption cycles that may impact the industry going forward?
What is needed to manufacture with profitability? Is the model based purely on buying wafers from China and hammering down in-house costs on a quarterly basis, or is there a supplier/customer model that sees both parties sharing profit margins?
What is the role of overseas companies, and how can they add value to the Indian sector, and not simply be a strategically-funded platform to expand global reach?
How can the downstream segment within India (developers/EPC/investors) benefit financially from the increased availability of Indian-made PV modules (using domestic produced cells and possibly even wafers)?
What policy-driven, government-backed vehicle can make the above questions work in parallel?

These questions are possibly the most pertinent when considering how India moves forward with PV manufacturing, and to get to the bottom of these it is clear that a broad range of stakeholders need to be part of the overall decision-making process: something that has probably not occurred until now.

PV IndiaTech to provide global platform to facilitate India-PV planning

In order to address the questions listed above, it is clear that a forum needs to be created that hears the voices of the different parties that will be needed to fashion a plan that works to everyone’s benefit.

This is the fundamental goal of the PV IndiaTech conference, the first event due to be held in Delhi on 24-25 April 2019.

While there are numerous PV events within India these days – as would be expected from a 10GW-level annual end-market – the role of PV-Tech, as a leading global PV platform and the host of the PV CellTech and PV ModuleTech events, should not be underestimated. India needs global expertise and a connection of its upstream/downstream segments, while having the understanding of which roadmaps are worth aligning with to be industry-competitive going forward; and also welcoming the expertise that exists from the correct overseas technical and financial investors.

We are currently in the process of finishing off the agenda for the forthcoming PV IndiaTech 2019 conference, including key partners, speakers and event contributors. If you would like to feed into this process, or be part of the event in Delhi on 24-25 April 2019, then please reach out to us by email at, or drop me a line directly (by clicking on my name at the top of this article) with your ideas and suggestions.

During the build up to PV IndiaTech 2019, PV-Tech will be taking a closer look at many of the issues raised within this article, as well as highlighting the event in Delhi including interviews with all the parties seeking to find a solution to unlocking the potential of Indian PV manufacturing over the next 10-20 years.

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PV ModuleTech 2018 to reveal module technology and supplier landscape for 2019 utility solar

So far in 2018, the solar industry has been through a succession of changes that will reshape the module suppliers and technologies used for utility-scale solar deployment globally in 2019.

The segments of the value-chain this will affect most are companies and third-party agencies that specify, qualify, purchase, design, finance and build large-scale ground-mounted solar farms.

Having been through 5-10 years of minimal disruption, developers and EPCs are soon going to have to make critical decisions related to site design, yield calculations and asset valuations, in order to avoid ending up with stranded assets that will ultimately command increasingly lower secondary revenues when sold on.

Equally under the spotlight will be the banks and lenders for utility-scale solar, with IRR projections now subject to a far greater range of input variables, than seen in the past.

These topics are set to be central to PV-Tech’s forthcoming PV ModuleTech 2018 conference, in Penang, Malaysia, on 23-24 October 2018.

This event will provide clear guidance to downstream stakeholders, with visibility on what module types will be available from the 10-20 global/bankable module suppliers in the industry today.

In this article, I outline the background to these changes, and introduce the agenda and speakers for the PV ModuleTech 2018 event in October.

Mono, PERC and bifacial move to mainstream utility offering

As we have been discussing for the past few years on PV-Tech, utility-solar sites were historically biased to 60 and 72-cell p-type multi-cell based modules, with an increasing share of the supply coming from outsourced module assembly across Southeast Asia, in particular Vietnam.

Reverse-auction based tenders across various emerging global markets (especially India) kept the demand for multi modules high, with site capex being the main driver when choosing module supplier/technology.

This is now changing at a rapid pace, stimulated by mono wafer supply becoming high-volume and commoditized, the China-531 effect destroying the sales pipeline for multi in China, and the natural progression from PERC-based mono modules that is gripping the market today, namely bifacial modules.

Many parts of the world are still characterized by EPCs and developers proclaiming their preference for 72-cell multi panels, but ultimately this will be short-lived with a rapid technology change occurring in 2019 that will lead to p-type mono PERC bifacial modules becoming the mainstream industry-offering for utility solar in 2020.

Anyone currently citing the price delta that has generally been constant over the years between a multi and a mono panel, a non-PERC (standard, or Al-BSF based) and PERC-variant, and (shortly) a mono-facial and bifacial module – fear not! Within 12-18 months, the pricing for p-mono PERC bifacial modules will be as competitive with any relatively cautious ASP-erosion trajectory that could be applied to leading multi-based products on the market today.

Margins for niche high-performing technologies only exist, so long as they have supply tightness. Move this technology to mainstream and market-factors kick in and competition ultimately removes any delta that existed in the past with lower-performing alternatives.

So, why does it matter? If the question was simply being able to use higher-efficiency modules, then we have the obvious benefits for site footprint and lower BoS costs. But the use of bifaciality changes everything now. As I noted in a feature on PV-Tech last week, EPCs and developers are now going to have to spend more time on module mounting (height), what the ground/space looks like below the modules, and what type of multi-axis tracking system to use.

The reason for this is simple. Bifacial modules have the potential for site yield gain that ultimately feed directly into higher IRRs for investors. And there is simply no greater driver on the planet. Indeed, one needs to remember that IRR is everything, and way more than the upfront investment level. If double-digit enhancements to IRRs are on the cards, expect no arguments at all when seeking to up investment levels to accommodate higher component capex (mainly from the addition of trackers).

Again, there is nothing new here. It is just that bifaciality unlocks yield capability that was not on offer before.

While virtually all p-type silicon-based module suppliers will move en-masse to bifaciality (aside from a few small players serving local residential segments of the market), 2019 will also see high-volume supply of the utility-optimized Series 6 panel from First Solar, in addition to far more n-type availability that includes new commercial offerings from the likes of SunPower and others.

Back-to-basics: what do developers and EPCs need to know right now!

Having attended, moderated and presented at countless industry events over the past few years where bifaciality was promoted, championed and presented as a fait-accompli, there remains a gap between what the mainstream developers/EPCs know and what the module suppliers and testing houses would like them to know.

There are bifacial workshops appearing now as though there is a world road-trip tour in progress. However, as immensely valuable as these are, bifacial availability and expectations need to have a pragmatic approach that is founded on risk-mitigation and mainstream product availability.

It is largely on this basis that bifaciality will be addressed at PV ModuleTech 2018 in October, with the technology evaluated directly with all other module technologies (c-Si and thin-film, n-type and p-type, mono and multi) that will form the overall utility-solar mix over the next 12 months.

In setting up the agenda, topics, speakers and discussion forums for the event, the following questions came up as being critical to explain to the EPCs, installers and developers that are the main beneficiaries of the PV ModuleTech conferences:

  • Simple explanation of what the main differences are between standard (mono/single-sided solar panels) and bifacial
  • What changes are done in assembly lines to move from today’s offering to bifacial design? Do the fabs need new equipment? What are the new process steps? What are the differences in materials used? Are these materials reliable and tested in harsh environments?
  • Which companies are offering bifacial modules in volume supply today? Are these companies bankable from a financial standpoint? What track-record do they have in supplying bifacial modules? Which test houses have developed bankability tests for lenders?
  • Are there standard testing/auditing/certification channels available? Who are the different third-party agencies offering these today, and which end-markets are they applicable to?
  • How important is mounting, panel height, and tracking design? Are the module suppliers aligned with tracking providers when offering complete solutions? Should this be the industry norm going forward for bifaciality?

Actually, the list is much longer than this, as may be expected from a technology that is new to the vast proportion of developers and EPCs in the market today.

Moving on from bifacial modules, developers and EPCs also need to learn exactly what is coming through from new n-type modules and if the strong Chinese investments of the past year will be worth considering during 2019.

Again, most developers and EPCs do not have experience with n-type modules yet, aside from those that have been loyal supporters of SunPower’s E-Series panels in the past. Putting aside the efficiency gains (at STC) from n-type panels (compared to p-type), n-type (alongside all thin-film offerings such as Series 4 and 6 panels from First Solar) has one massive benefit to utility-solar through a significantly better elevated temperature coefficient. As greater products flow to the utility segment next year, this is clearly something for developers and EPCs to be aware of, especially if they have evolved using only 72-cell multi on fixed mounting schemes.

Introducing the agenda for PV ModuleTech 2018

The sessions at PV ModuleTech this year once again address module supply, technology and quality, through having all key stakeholders speaking and discussing the key themes for the market over the next 12-18 months.

To attend the PV ModuleTech 2018 event in Penang, Malaysia on 23-24 October 2018, please follow the link here. Now for a talk through the event agenda!

Opening Presentation from the Conference Chair

The opening talk will provide a detailed understanding of how module supply is changing in the PV industry today, with utility markets outside China set to drive the global PV market from 2019 onwards. The talk will outline the forecasted market-share allocations of the leading global suppliers in 2019, and the expected module technologies being shipped outside China. The topics covered will outline the key topics to be presented and discussed over the two days at PV ModuleTech 2018.

Non-China Global Module Supply for Utility Solar: Understanding the US, India, Japan & Australia Markets

The opening session will feature presentations on the four main utility-scale countries for PV demand today (excluding the Chinese market) namely the US, India, Japan and Australia. These four countries have emerged as multi-GW demand regions, with stable policy environments and long-term drivers that ensure they retain priority status for module suppliers.

Perspectives from Market Leaders: Quality in Module Supply, Materials & Panel Assembly

This session will hear from three of the leading companies today, impacting module technologies, materials and production equipment used in the supply of quality and reliable products for large-scale utility solar deployment. The companies and speakers will address the key metrics underpinning today’s state-of-the-art module assembly and supply, while addressing the next-generation product improvements that will offer improved reliability and higher output yield for EPCs and developers.

New Markets for Utility Solar: Module Demands & Requirements from Emerging Global Regions & India

Various panel discussions will be chaired on-stage during this session, with speakers and panellists chosen from a range of experience local developers, EPCs, O&Ms and Asset Owners active today in Southeast Asia, Middle-East & Africa, and Latin America. These regions comprise a wide range of countries where utility solar is being deployed today, often accompanied by government tenders and auctions. Coupled with the Indian market, there is expected to be a transition during 2019 as these regions see more higher-performing panels deployed, but how well prepared are the module suppliers to guarantee reliable operation over the lifetime of the plants?

Meeting the Demands of Leading Developers, EPCs & O&Ms

This session explores some of the key issues for module selection, operation and optimization at utility solar sites, from initial company/technology selection to maximizing plant asset value at the secondary site sales process – both when undertaking due diligence to acquire build sites or packaging owned sites for selling. Speakers will address the major factors that impact on module quality and reliability, from project development, site construction, site valuation and O&M.

Bifacial Module Questions: What the Industry Needs to Know Today

With module supply for utility solar transitioning from 72-cell p-multi to p-mono PERC, the next phase of module technology upgrading will see widespread deployment of bifaciality, with rear-side efficiency gains creating strong upside to site yields. However, despite the obvious advantages in the field, many questions remain to be answered in order to fully understand what can be expected in the field over 20-30 years of operation. This session will hear from both module suppliers and the third-party organizations now offering benchmarking and yield tools to assist developers, EPCs and lenders to accurately predict bifacial site yields and return-on-investment.

New Module Technologies for Enhanced Site Performance: Why 2019 Represents a Breakthrough Year for Global Utility Solar Deployment

Closing out the first day of PV ModuleTech 2018, this session will feature talks explaining some of the new products that are set to impact the global utility solar segment in 2019. First, an overview will be provided revealing the full range of PV module technologies that are available today, including n-type and thin-film offerings that have a strong track-record in the industry going back more than ten years. This will be followed by First Solar, outlining some of the key features that make its Series 6 introduction one of the most significant and successful new product roll-outs yet seen within the PV industry.

Enhancing Module Site Performance through Material Optimization & Light Capturing

The use of new and advanced materials and films during the module assembly process is known to be critical to increase power levels and site yields over the lifetime of products. In addition to outlining the latest material innovations, this session will see strong focus on the use of light capturing films and related module performance, including how to model enhancement levels and supporting data from test and validation, and third-party agencies.

Defining Reliability Metrics for Utility-Scale Module Deployment

This session will focus on module reliability in the field, starting with an invited keynote presentation from SunPower, as one of the leading suppliers of modules to utility-scale solar over the past 20 years. The following panel discussion will then hear perspectives from various module stakeholders through the value-chain, supporting the need to make purchasing decisions based on maximising LCOE with minimal risk.

Learning from Established Multi-GW Global Module Suppliers

With only a small group of PV module suppliers having been serving the global utility market consistently over the past 10 years, these companies have accumulated significant knowledge on how to specify modules and design solar sites to maximize yield and returns. Two of these companies – Trina Solar and Talesun – have also been heavily involved in project development and as lead-contractor during EPC activities, often packaging portfolios of sites for to sell on to institutional investors. This session will hear from Trina Solar, Talesun and others on how these learnings will be impacting module availability and project development during 2019 and beyond.

Testing, Auditing, Insurance, Warranty & Bankability of PV Modules: What Developers & EPCs Need to Know Today

Selecting module suppliers, their technologies, and point-of-manufacture remains one of the biggest challenges to global developers, EPCs and lenders, with a wide range of third-party agencies operating both globally, regionally and at the country-specific level. This session will hear from some of the leading companies filling this need in the industry, providing key data-points for those specifying, using and owning utility-scale sites in the future.

Leading Global Chinese Module Suppliers Talk 2019 Module Supply How Prepared are Third-Party Agencies, Developers & EPCs for 2019 Module Offerings

The final sessions of PV ModuleTech 2018 will provide an ideal platform for conference attendees to piece together all the information and learnings from the two days. Configured as an ideal ‘tool’ for attendees mandated to feedback takeaways to company teams members or to report to corporate internally, the two sessions below will seek to provide conclusions, answers, and outstanding questions fundamental to module selection, performance and quality going into 2019.

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Tesla’s solar panel suppliers have changed rapidly

In the hotly contested Californian residential solar market, new data compiled by ROTH Capital Partners highlights, amongst many data points, that Tesla’s solar panel supply base and suppliers is undergoing a major transition and that it has been changing for several years.

PV Tech has well documented the dynamic US residential market and its key public listed installers, which used to be dominated by SolarCity but since its acquisition by Tesla, sales and business strategies have radically changed in an effort to create a sustainable business, instead of being market share driven.

US market leadership has changed hands in the past year but at the same time installation growth has been hard to achieve for the leading publically listed US installers. 

Tesla’s quarterly solar installation figures have declined rapidly but showed a small upward trend in the second quarter of 2018.

Data compiled by ROTH Capital, highlights that Tesla’s panel supplier base has changed rapidly from the SolarCity days. 

Back in 2016, Kyocera and REC Group had been the main panel suppliers to the company, accounting for 31% and 35% of supply to California installs, respectively. A much smaller share came from two ‘Silicon Module Super League (SMSL) members, Trina Solar and Canadian Solar with 7% and 6%, respectively. 

In that year, the company also sourced panels (only in the fourth quarter) from Hanwha Q Cells and LG Electronics, 1% and 3%, respectively. Unspecified ‘other’ suppliers accounted for 7% of the total through 2016. 
However, a lot of changes occurred in 2017.

The chart below shows Tesla’s module suppliers that were used for installations in California since the beginning of 2017 through to May 2018. 

In 2017, the company increased its use of Canadian Solar, Trina Solar and LG Electronics considerably. By year-end Canadian Solar’s share was 15%, while Trina Solar’s totalled 28%, but to highlight the growth, Trina Solar accounted for only 3% of supply in January, 2017 and ended with a share of 33% in December.

In the case of LG Electronics the supply would seem to have been a short partnership, having mainly started strongly in the fourth quarter of 2016, it peaked in February, 2017 (30% of supply) and leaned out significantly by December (2%) and accounted for 14% of supply in 2017.
Long-term trusted suppliers, Kyocera and REC Group lost out in 2017 as their shares declined to 4% and 10%, respectively. The others also were whittled down from the 7% share in 2016 to just 1% in 2017. 

But the supplier base has changed again in 2018. Although data is only available through May, the chart highlights that Canadian Solar’s erratic share through 2017, ended abruptly at the beginning of 2018 and only recovered to 2% of the total by May. 

Trina Solar, which had been the largest supplier to Tesla from the second quarter of 2017 saw its share fall from a peak of 45% in October, 2017 to 28% by May, 2018.

Although Hanwha Q CELLS share started relatively strongly in the first quarter of 2017, the chart shows an erratic pattern, similar to that of Canadian Solar. The only difference here is that Hanwha Q CELLS share suddenly bounced back from zero in April, 2018 to 17% in May this year. This is the only supplier to have gained meaningful share through the first five months of 2018.

Tesla’s own modules

However, the most dramatic change comes from within Tesla. Starting in March, 2016 it would seem that panels produced in-house at its Fremont facility (formerly Silevo), which was known to have around 100MW of annual capacity started supplying panels to projects in California. 

This ramped (dark blue line in the chart) through the rest of the year, accounting for an 11% share. However, Tesla’s own panel supply to California installs took a notable dive through May, 2017 but bounced back strongly, peaking in November with a 35% share and share for the year of 18%, which also highlights the capacity constraint of the Fremont production facility. Only Trina Solar had a bigger share (28%) in 2017. 

The supply dramatically changed again at the beginning of 2018, when Tesla’s panel share rocketed to 56% in January and peaked at 64% in April. This could be attributed to panel production finally ramping at the Panasonic managed Gigafactory 2 in Buffalo, New York state. 

Interestingly, reports of some re-tooling at Gigafactory 2 could be reflected in the peaks and troughs seen in 2018, as production levels may have fallen during equipment changes. 

Although still early to be sure, the chart also indicates that Tesla has in the first five months of the current year, narrowed down its panel supplier base, depending very much on its in-house capacity but retaining two SMSL members, Trina Solar and Hanwha Q CELLS as its major external suppliers. 

It should also be noted that Hanwha Q CELLS (Korea) has announced the building of at least a 1.6GW assembly plant in Whitfield County, Georgia. 

Finally a special thank you call-out to Philip Shen, financial analyst at ROTH Capital for sharing the volume of data that also covered companies such as SunPower, Sunrun, Sunworks, SolarEdge and Enphase.


Note: The California Distributed Generation Statistics publishes all IOU solar PV net energy metering (NEM) interconnection data from the three large California Investor Owned Utilities (IOUs) which include Pacific Gas & Electric Company (PG&E), Southern California Edison Company (SCE), and San Diego Gas & Electric Company (SDG&E). 

California Distributed Generation Statistics also publishes all IOU data from the California Solar Initiative incentive program and other publicly available incentive program data sets.

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