China National Energy Administration released statistics right after the Lunar New Year: Up until late-2016, the cumulative PV installation reached 77.42GW in China. The newly-added installation reached 34.54GW in 2016, a doubled growth rate compared to 15.13GW in 2015. If deducting the projects that completed installation in 2015 but postponed grid-connection to 2016 (4-7GW), the actual Chinese demand was about 30GW in 2016, higher than the anticipation, and 4.24GW of which were distributed generation (DG), up 200% from 1.39GW in 2015.
Judging from the module supply, the Chinese market saw high supply concentration. According to EnergyTrend’s statistics, the top five suppliers – JA Solar, GCL-Si, Jinko Solar, Lerri Solar, and Trina Solar contributed more than 2GW of supply to China in 2016, in which JA Solar, GCL-Si, and Lerri Solar increased their supplies significantly compared to 2015. The top ten module suppliers represented about 60% of the total market share.
Mono-Si module is getting more popular since last year. Since leading manufacturers kept the price gap between conventional mono and multi-Si modules at US$ 0.01/W, the share of mono-Si modules has surpassed 25% in the Chinese market due to the high C/P ratio. Although Lerri Solar, JA Solar, and Jinko Solar are still the top three mono-Si module suppliers, more and more cell and module suppliers have joined the mono-Si competition last year. This has caused the top three suppliers to witness a mono-Si share of less than 50% in China, showing the thriving development of mono-Si products.
Looking ahead for 2017, due to the serious supply shortage for mono-Si wafers in 1Q, the mono-Si market expansion is limited. The price gap between mono and multi-Si wafers, cells, and modules has increased, leading to mono-Si’s weaker C/P ratio compared to last year. Many manufacturers couldn’t purchase enough mono-Si wafers and had to negotiate to ship out multi-Si products instead. Yet, Longi and Zhonghuan, the top two wafer suppliers, are planning to start their capacity expansions after April, which may alleviate the shortage problem for mono-Si wafers.
Although demand will slightly decline after China’s grid-connected installation reached 30GW in 2016, there will be over 25GW of installation in 2017. Mono-Si products will continue to witness higher shares following the promotion of the “Top Runner Program” and PERC cells. Some manufacturers use diamond wire cut for multi-Si wafers to reduce costs this year, but due to the uncertainty of the etching technology, multi-Si wafers using diamond wire cut won’t be seen until 3Q. Mono-Si’s shares should be able to reach 35% this year in China. Whether it will continue to grow will have to depend on further cost reduction for mono and multi-Si wafers.
