Photovoltaic: When the profit is exhausted, when will it come?

Sep 13,2018

From the current situation, it seems that it is not appropriate to describe the development of China's photovoltaic industry. This point can be seen from the performance of listed companies in the photovoltaic industry in the capital market in recent months. If the National Development and Reform Commission, the Ministry of Finance, and the National Energy Administration jointly issued the "Notice on the Adjustment of Photovoltaic Power Generation in 2018" (hereinafter referred to as the "531" New Deal), it provides a new development direction for the industry; if it is said, historical experience It shows that Chinese PV people who have undergone hardships and insults can always survive the cold winter after crouching; if, after getting rid of subsidies, PV can really develop healthily and steadily, then, the arrival of “good”, or permission period.

Li Chuangjun, deputy director of the New Energy and Renewable Energy Department of the National Energy Administration, said: "China's photovoltaic power generation has undergone stages of growth, industrialization, and large-scale development. The current development needs to shift from scaling up to improving efficiency and promoting technology. Progress. We need to promote technological progress, reduce power generation costs, reduce subsidy dependence, optimize development scale, improve operational quality, and promote orderly development and high-quality development of the industry from a more sustainable and sustainable development." Perhaps this will It will become the basic idea for the development of photovoltaic power generation this year and for some time to come.

Photovoltaic adult ceremony

Recently, the International Energy Agency (IEA) released data that global renewable energy investment decreased to 318 billion US dollars in 2017, down 7% year-on-year. The International Energy Agency has sounded the alarm for the “pause” of clean energy development. In addition, the International Energy Agency believes that the reduction of investment in this area will continue until 2018, which will pose a threat to energy security, climate change and air pollution prevention.

According to the World Energy Investment Report, the proportion of fossil fuel investment in 2017 has increased to 790 billion US dollars, which is the first increase since 2014 and has a profound impact on the current global energy development trend. In recent years, although the investment in coal-fired power generation industry has decreased drastically, the level of oil and natural gas consumption has risen step by step. Fatih Birol, Director of the International Energy Agency, commented on the reduction of renewable energy investment: “The phenomenon of investment reduction is disappointing. What is even more worrying is that this trend will continue into 2018 and should be Be wary. If the climate target is to be achieved on time, by 2030, the proportion of fossil fuels in energy investment should be reduced by 40%, but in 2017 there will be a small increase, accounting for 59%. Globally, the total energy investment in 2017 was about 1.8 trillion US dollars, down 2% year-on-year. The investment in the power industry accounted for two consecutive years higher than oil and gas.

From the domestic situation, the China Electricity Council announced data recently showed that in the first half of this year, the country's infrastructure new power generation capacity was 52.11 million kilowatts, including 2.49 million kilowatts of hydropower, 15.15 million kilowatts of thermal power, 1.13 million kilowatts of nuclear power, and 7.53 million kilowatts of wind power. Solar power generation was 25.81 million kilowatts, and solar power generation was 2.19 million kilowatts more than the same period of the previous year. The newly generated power generation capacity of solar power generation accounted for nearly half of the newly built power generation capacity of the national infrastructure. The data shows that although China's new energy industry, represented by photovoltaics and wind power, has achieved rapid development, its development content and trends have presented different situations. The photovoltaic industry is affected by the slowdown in new construction and the subsidy policy. It faces serious challenges of reducing power generation costs, optimizing development scale and improving operational quality. The wind power industry is accelerating the pace of development of offshore wind power and distributed wind power. Under the situation of a decline in installed capacity in the past two years, the situation has been reversed.

On the eve of Children’s Day, the “531” New Deal was released, and China’s photovoltaics ushered in an adult ceremony.

The photovoltaic industry generally believes that the reason for the introduction of such a strict new policy is that the subsidy pressure is too great and it is difficult to solve in the short term. Over the years, China's promotion of renewable energy industry mainly adopts the method of “standard price and financial subsidy”. The subsidy funds are derived from the renewable energy price and are charged with electricity. However, as the photovoltaic installations climbed rapidly, the subsidy gap continued to expand. According to statistics, as of the end of 2017, the renewable energy subsidy gap has reached 100 billion yuan.

A number of analysts expect that due to the impact of the New Deal, China's new installed PV capacity may fall to 35 GW in 2018. In comparison, China’s new installed capacity for the whole year last year was 53.06 GW. The sharp shrinkage of new installed capacity will undoubtedly put tremendous pressure on domestic PV manufacturing industry, and a new round of industry reshuffle caused by equipment price reduction is inevitable. Large enterprises in the industry's first echelon and strong cost control ability can obtain support from foreign markets, and SMEs are difficult to survive the industry.

Analysts believe that the intention of this policy adjustment is to reduce the subsidy gap of incremental projects and make the photovoltaic industry develop healthier. The competent authorities are evading the risk of a larger subsidy gap by “proactively piercing the bubble”. This round of PV “Peer-to-Air Internet Cycle”, which will be launched after 2020, will simultaneously launch the third-generation energy centered on “coal oil and gas” with the “horizontal storage” as the core for the global energy landscape. substitute. In reviewing the new policy, China Photovoltaic Industry Association also proposed that under the new normal of subsidy pressure and the country is still vigorously reducing the cost of social electricity, it is bound to be unsustainable. In the last round of changes in the photovoltaic industry, a group of truly high-quality enterprises were tempered, and it is hoped that this round of changes will enable the whole industry to self-improve before the fair price online adult ceremony.

Industry chain "cold winter"

After the "531" New Deal, the photovoltaic industry industry chain collectively entered the freezing period, and the profitable silicon material end price fell off the cliff, and there was no market price. After the release of the New Deal, the Silicon Industry Branch analysis showed that “for the entire Chinese polysilicon photovoltaic industry, the “531” PV New Deal has become the third and most significant crisis in the industry after 2008 and 2012. The price of the material has dropped by 25.5% within one month. The sharp decline in terminal demand and the sharp drop in prices have forcibly accelerated the reshuffle of the new round of polysilicon industry, and will also cost the accident to an absolute international advantage. High-end production capacity. At present, it is at the stage of reducing costs and increasing efficiency and investing in research and development. The terminal market in this key node has shrunk sharply, which has led some domestic enterprises to delay or even suspend technological transformation and high-quality expansion projects, and continue to invest in research and development. The power is gradually disappearing. If the price and cost are upside down for a long time, the excellent enterprises will lose their hematopoiesis and growth function. The polysilicon industry that has developed after ten years of hardship will once again be in a desperate situation. According to Caixin, the impact of the “531” New Deal has been Spread the entire industry chain. The photovoltaic industry chain can be roughly divided into upstream polysilicon, silicon wafers, mid-stream battery chips, components, and downstream power stations. For PV upstream polysilicon companies, most polysilicon manufacturers have decided to intensively arrange production line maintenance plans from June to September to control production capacity.

In fact, as 12 polysilicon companies chose to overhaul or stop production in June, the maintenance capacity reached 82,500 tons/year, accounting for 27.7% of the total domestic production capacity, which drastically reduced the supply. According to the maintenance plan of each enterprise, domestic polysilicon production will be further reduced to about 16,000 tons in July, and the supply of overseas companies OCI and HKS will also decrease, which will help the market supply and demand to further improve. On July 23, the transaction price of solar premium dense materials, the transaction price of solar first-class dense materials and the transaction price of solar first-class vegetable flowers all increased, ranging from 0.21% to 1%. This is the first time since June that polysilicon prices have stabilized. Previously, polysilicon quotes have fallen for six weeks.

In the first week of August 2018, the domestic polysilicon premium grade material price range rebounded to 90,000 yuan / ton ~ 98,000 yuan / ton, the average price of 9500 yuan / ton, up 0.96% on a week-on-week basis. The mainstream price of polycrystalline silicon wafers is 2.40 yuan / piece ~ 2.80 yuan / piece, the average price is maintained at 2.45 yuan / piece; the mainstream price of monocrystalline silicon film is 3.15 yuan / piece ~ 3.26 yuan / piece, the average price is 3.18 yuan / piece, week-on-cycle It fell by 2.15%. It is understood that some enterprises have signed all the orders in August at the end of July, no spare capacity is available, and most of the orders in August have been signed more than 80%, and the balance is expected to be signed next week. Although the overall silicon material transaction volume this week was slightly lower than that of last week, the price of polysilicon continued to rise slightly due to the continuous supply shortage.

At present, there are 11 domestic maintenance companies, involving a production capacity of 131,500 tons/year, including 4 10,000-ton enterprises. It is expected that the production will be resumed in September. In August, the number of overhaul enterprises was increased from the original plan. The overall silicon material supply will increase slightly from the 14% to 22%, and the monthly supply is expected to decrease to 14,000 tons to 15,000 tons. In addition, overseas OCI and During the inspection period, HKS also became more and more obvious in August due to the shortage of silicon material supply. Therefore, it is not expected that the price will be a turning point in August, and the market can still maintain a stable operation.

"If the overall demand rises, the price of polysilicon will rebound, but the rebound will not be too large, because after the rebound, the existing polysilicon enterprises will fully load to meet the new demand of the market. If the overall demand continues to decline, then the polysilicon enterprise Will continue to stop maintenance, reduce market supply, and achieve a new balance between supply and demand. Therefore, the price rise and fall are relatively limited." The head of polysilicon enterprises told the public media.

A hard-hitting household market

Public information shows that tens of thousands of dealers and hundreds of thousands of users are the most common people, and their ability to withstand blows is much lower than that of enterprises. Under the trend of scale restrictions and subsidies, it led to the withdrawal of a large number of household dealers. Behind the industry's cessation of development is the common reasons for the uneven quality of household PV products and the lack of operation and maintenance of power plants.

After the public information is summarized, it can be seen that the power supply companies of the provinces are not “friendly” to the grid-connected policies of distributed photovoltaics: On June 6, the State Grid Hebei Electric Power Co., Ltd. issued a notice, since June 1, 2018. From the beginning, stop the payment of distributed PV national subsidies. According to Jiangsu household use PV dealers, Wuxi has no longer accepted new household PV projects. Household PVs that were applied before June 1 but not connected to the grid will not be accepted for the time being. Jiangsu Jurong suspended all distributed PV acceptance business, and the accepted projects can continue to be connected to the grid, but users connected to the grid after May 31 will not be able to enjoy the national subsidy of 0.37 yuan. Shandong has basically stopped the processing of distributed photovoltaics. If residents are to be connected to the network, they must sign a letter of commitment to abandon subsidies. Another regional grid company issued a customer notification stating that the distributed project countries connected to the grid after May 31 will not be able to receive subsidies. In addition to Shandong, Jiangsu, and Hebei provinces, the following areas have been explicitly accepted for grid connection: Henan Xuchang: Temporary acceptance of photovoltaic grid application. Chaoyang, Liaoning: There are subsidies not to be connected to the grid, and no subsidies can be connected to the grid. Shanghai: It is reported that the Shanghai area has decided to suspend the subsidy. However, Shanghai Songjiang District recently issued a document saying that it will introduce a photovoltaic district-level subsidy of 0.2 yuan for two consecutive years.

According to the new policy, the domestic market will be suppressed to 25 GW in 2018 (25 GW = distributed 10 GW, front runner + photovoltaic poverty alleviation 10.7 GW, 2017 general power station project about 5 GW), just 2017 47% of the 53 GW in the year, the domestic and international market size will not exceed 65 GW. The limitation of scale will inevitably cause the production capacity of the photovoltaic manufacturing industry to be idle. According to industry estimates, the number of affected household projects in the country may reach 60,000 to 80,000. After the 531 New Deal, some household enterprises turned to small and medium-sized industrial and commercial distribution, but the difficulty faced by industrial and commercial self-use is the difficulty in collecting electricity charges, and some turn to various photovoltaics, such as photovoltaic + heating, photovoltaic + energy storage, and inverter manufacturers. Overweight to open up overseas markets.

"Last chance"

In this new policy, the National Energy Administration strictly controls various indicators, but the only exception is: photovoltaic poverty alleviation. Even though ordinary and distributed projects have been “cool”, PV poverty alleviation projects are supported as always. The benchmark electricity price of village-level photovoltaic poverty alleviation power stations (0.5 MW and below) in line with national policies remains unchanged. In the second half of this year, the village-level photovoltaic poverty alleviation project will become the “sweet” of the industry. Regarding the total amount of this part of the project, it is currently uncertain, but in the second half of the year, this part of the project will become a must for PV companies.

The “531” New Deal pointed out: “Supporting photovoltaic poverty alleviation. Implementing precise poverty alleviation and accurate poverty alleviation requirements, solidly promoting photovoltaic poverty alleviation work, and timely launching the “13th Five-Year Plan” second batch of photovoltaic poverty alleviation projects on the premise of implementing implementation conditions and strict auditing in various places. Plan. According to the 13th Five-Year Plan, the poverty alleviation target for the whole year of 2018 is around 8 GW. The first batch of PV poverty alleviation scale was 4.186 GW, and the centralized poverty alleviation power station was connected to the grid before 630. The village-level poverty alleviation power station was completed at the end of the year. According to the scale issued in previous years, the scale of the second batch of poverty alleviation projects is about 4 GW, and the total amount is about 8 GW.

However, it is necessary to worry that after the issuance of the new “Management Measures for Photovoltaic Poverty Alleviation Power Stations” this year, photovoltaic poverty alleviation power stations shall not be in debt construction, and enterprises may not invest in shares. This is equivalent to cutting off the financing route of the poverty alleviation project, which means that the funding problem of the PV poverty alleviation project will not be solved through financing, and it needs to be fully borne by the local government. Therefore, the number of poverty alleviation power stations can be built, which has nothing to do with the enterprises, but is affected by factors such as the local poverty-stricken poverty alleviation, the number of local poor households, and the funds of the local government. However, for a PV power plant project, no financing channel will bear a lot of financial pressure. The new policy stipulates that local governments' unilateral financial commitments will probably dampen the government's enthusiasm for developing photovoltaic poverty alleviation projects.

In addition, the front runner project also shows the vitality of survival in the crack. The 10 application leading bases in the third batch of leading bases have completed the enterprise optimization work and have now fully entered the implementation stage. According to the policy, the application of the leading base needs to start construction before June 30 this year. A total of 5 GW of application leader projects will also become crucial for the market in the second half of the year.

In view of the fact that “the construction of the leading base will be obvious, the construction of the fourth phase leader base will be started in due course in the second half of the year. In the future, the construction of the leading base will be the main position and important way for the construction of ordinary power stations.” The industry also believes that the fourth stage runner base The scale of construction is likely to reach about 10 GW. According to the implementation plan of the third-phase runners, each front-runner base has a scale of 500,000 kilowatts, including a total of 6.5 million kilowatts for thirteen bases including the front runner base and the technical leader base. The National Energy Administration's Guiding Opinions on the Implementation of the 13th Five-Year Plan for Renewable Energy Development has a planned control base of 8 million kilowatts per phase. That is to say, the remaining leader of the third period still has an indicator of 1.5 million kilowatts remaining. This part of the scale is likely to be incorporated into the construction of the fourth-stage runner base, so the construction of the fourth-stage runner base may reach 9.5 GW. It is predicted that the future ordinary PV power plant project may be invested in the construction of the current leader project, in short, the leader of the ordinary power plant project.