Longi Plans World's Largest Solar Factory for $6.7 Billion

Top clean energy equipment manufacturer Longi Green Energy Technology Co. is planning to invest 45.2 billion yuan ($6.7 billion) to build the world’s largest solar manufacturing base.

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The company signed a letter of intent with local governments in China’s Shaanxi province for an expansion project that would allow it to build manufacturing capabilities to produce 100 gigawatts of solar wafers and 50 gigawatts of solar cells per year, according to a filingBloomberg Terminal to the Shanghai Stock Exchange.

The rise in the need for solar energy has resulted in a growth in the global photovoltaic (PV) industry in terms of both overall capacity and shipments of PV products in 2022. This has opened up prospects for manufacturers, particularly for Chinese solar module suppliers.

Based on information that is accessible to the public, Chinese PV module firms hold a significant portion of the leading ten module manufacturers worldwide.

China PV Module Production 2022

China’s PV module production was 124.6GW in 2020, up 26.37% from 2019, and 182GW in 2021, up 46.07% from 2020. And that in 2022 was 288.7GW, a dramatic increase from 2021, representing growth of 58.63%.

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In terms of production capacity, China’s PV module production capacity was 220GW in 2020, an increase of 29.41% year-on-year. And in 2021, it was 350GW, a 59.09% increase year on year. Then, in 2022, the solar module production capacity in China is estimated to reach 397GW, representing a year-on-year increase of 13.43%.

PV modules shipped from China in 2022

Despite a complex global solar market impacted by a range of uncertain factors such as pricing and costs, policy shifts, and the pandemic, over 50% of China's PV modules were provided to foreign clients in 2022.

In recent years, both the amount and worth of exports have increased. In 2021, China's solar module exports crossed 100 gigawatts for the first time, with a yearly growth rate of over 25%, and the export worth surpassed $20 billion, reflecting an increase of 15%-20%. In 2022, China's PV goods, including a module value estimated at $42.361 billion and an export volume of 153.6GW, were exported for over $50 billion, indicating a year-on-year growth of 55.8%.

In 2022, due to the increase in solar energy usage, the European Union (EU) became the largest region for China's PV exports. China exported nearly $23 billion worth of products, equivalent to approximately 84GW of solar modules, which accounted for more than half of China's total module exports and represented a year-on-year increase of 114.9%. According to Mr. Zhang Sen, the Secretary-General of the Photovoltaic Branch of China Chamber of Commerce for Import and Export of Mechanical and Electrical Products, at the 2022 Photovoltaic Development Review and Outlook in 2023 Conference organized by the China Photovoltaic Industry Association (CPIA) on 16 February 2023, the Netherlands, Brazil, and Spain were the top three markets for China's module exports, accounting for 46% of China's overall export volume. Furthermore, the demand for solar modules in Spain, Germany, and Poland was increasing. Mr. Zhang Sen also stated that China's cumulative photovoltaic module exports exceeded $200 billion in the past decade, and the cumulative exports volume of modules surpassed 575GW.

China’s top PV module manufacturers

China's top PV module manufacturers, which also happen to be the world's top seven, including LONGi Green Energy, JinkoSolar, Trina Solar, JA Solar, Risen Energy, Astronergy (Chint), and TW Solar, heavily rely on overseas revenue.

Among these manufacturers, LONGi, Trina Solar, JinkoSolar, and JA Solar have remained in the top 4, with a combined global shipment of approximately 171GW.

LONGi, considered an industry giant and benchmark, shipped nearly 45GW of solar modules in 2022, accounting for 17.5% of new installations. Its module shipment in 2021 was 38.52GW.

Trina Solar, known for its record-breaking cell efficiency and module performance, has emerged as a leading solar technology and manufacturing company, shipping around 43GW of modules in 2022 and 24.8GW in 2021.

JinkoSolar, a prominent solar manufacturer and the first solar energy company to join the RE100 green initiative, shipped 41.5-43.5GW of modules in 2022, an increase of 86.66%-95.66% compared to its module shipment of 22.233GW in 2021.

JA Solar, one of the most prominent solar product suppliers with over 20 branches worldwide, shipped 40-41GW of modules in 2022, a significant increase from the 25.45GW of modules and cells shipped in 2021.

China PV Module Production Outlook 2023

The rising global demand for solar energy has prompted PV manufacturers to increase their production capacity and make ambitious plans for future expansion. The China Photovoltaic Industry Association (CPIA) predicts that global newly added PV solar capacity will reach 280-330GW in 2023 and 324-386GW in 2025. To keep up with this demand, solar companies are encouraged to not only expand their production capacity but also establish vertically integrated production capacity from silicon material processing to wafer, cell, and module production, as well as manufacturing and R&D centres for technology improvement.

The top four PV module manufacturers, including LONGi, Trina Solar, JinkoSolar, and JA Solar, continue to strive to maintain their leading market positions, with rapid expansion of their production capacity. In early 2023, LONGi announced investments in 100GW of silicon wafers and 50GW of solar cells, and a 29GW high-efficiency solar cells project. Trina Solar will start self-supply of n-type silicon ingots and wafers by building a 35GW of CZ Si project and a 6.5GW of solar wafers project. Similarly, JinkoSolar and JA Solar also have ambitious expansion plans for vertically integrated production bases.

In addition, large modules are becoming more prevalent since 2021, and ultra-high power modules are being used in many GW-scale solar power stations worldwide. Although the 210mm module is currently the leader, it may be replaced by even larger ones. It is uncertain when Chinese manufacturers will reach their capacity limits and how many will unlock the potential of solar energy for the world.

However, what is clear is that solar power is playing a crucial role in providing clean energy to millions of people around the world, and Chinese PV brands are set to dominate the global solar supply chain in the medium to long term.

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