The solar industry has witnessed a rapid expansion of N-type cell technology, leveraging its superior conversion efficiency. The emergence of cost-effective TOPCon cell technology in 2022 has invited numerous solar industry participants into the competition, challenging the prevailing PERC cell technology, which mainly produces P-type cells.
Imminent Risk of Phased-out PERC Technology
As large-scale N-type cell capacities become a reality, there is a looming risk that a significant portion of PERC cell technology capacities may phase out within the next two to three years. The market dynamics are shifting in favor of N-type cells, driven by their increasing production capacities.
Potential Supply Shortages and Price Disparity
TrendForce’s analysis suggests that the incremental deployment of N-type cell capacities might lead to sporadic shortages of high-quality silicon materials and wafers tailored for N-type cells. This could establish a noticeable price disparity between N-type silicon and wafers compared to their P-type counterparts, impacting market dynamics.
Silicon Supply and Price Trends
The supply of silicon remains abundant, yet the price gap between P-type and N-type silicon continues to widen. By the end of 2023, polysilicon production capacity is projected to reach 2.072 million tons, reflecting a significant increase year-on-year.
However, as the market leans towards N-type cell technology, P-type silicon faces oversupply, causing its price to drop rapidly. In contrast, robust demand and limited output for N-type silicon might create periodic shortages, stabilizing its price and offering better profitability for silicon firms.
Wafer Production Capacities and Industry Dynamics
By the end of 2023, silicon wafer production capacity is projected to reach approximately 921.6 GW, with a substantial portion dedicated to N-type production to meet the increasing demand for N-type cell wafers. However, there’s a concern about potential short-term supply shortages for certain dimensions of P-type wafers due to this transition. Moreover, intensified industry competition and other factors could impact the competitive edge of leading companies like Longi and CMC in the silicon wafer manufacturing sector.
Projections and Global Solar Panel Capacity
Estimations for 2023 indicate an astounding 64.7 percent year-on-year increase in the worldwide solar panel capacity, reaching approximately 1,034 GW. The bulk of this capacity surge is attributed to Chinese enterprises, driven by policies supporting local manufacturing.
Leading Chinese solar panel manufacturers, including Longi, JinkoSolar, JA Solar, and TrinaSolar, have expanded their operations to various regions, maintaining China’s dominant position with an anticipated 80-85 percent capacity share in 2023. The global competitive landscape for solar panels is expected to remain stable in the near term.