Electrical Equipment / Components & Telecoms

In September 2010, former US President Jimmy Carter came to Shanghai to participate in the World Expo. In the hotel where he stayed, a middle-aged man from Hospitable Shandong was waiting for him with a smile.

This person is Huang Ming, the founder of Shandong Huangming Water Heater Company. When I saw Carter this time, Huang Ming didn’t just come to take a photo with the President of the United States. He had a bigger plan: through a Chinese American professor, he got some scrap battery panels. Huang Ming wanted to let Carter go before. In the name of the President, these solar panels were donated to a solar museum in Texas (Shandong).

These scrap solar panels have a great background and have a deep connection with Carter. In 1979, Carter held a "Release Conference on the Roof" at the White House to celebrate the installation of a hot water system composed of 32 solar panels. Because the industry was immature, this small system could only boil hot water for the restaurant and laundry room downstairs, but the cost of the entire system was as high as US$280,000.

At that time, the United States had just recovered from the first oil crisis, and the days when it was "stuck" by the Middle East can still be seen. After Carter came to power, he was determined to be "autonomous and controllable" in energy. Considering that solar energy is an inexhaustible resource, it is just right as an object of support. So Carter stated that solar energy is "part of the greatest and most exciting adventure in American history [4]."

On the roof, Carter said nonsense to the camera: no one can block the light.

White House Rooftop Conference, 1979

Carter was still Tucson. In the presidential election one year later, Carter was defeated by Reagan because of the Iranian hostage crisis and economic stagnation. Reagan believed that "the best energy policy is no policy". He lifted price controls on the one hand and liberalized domestic supply on the other. Oil prices gradually Fall back. Industries such as photovoltaics with large investments, large subsidies, and slow results have been put into the cold.

Then in 1986, the solar panels on the roof of the White House that occupied the headlines of the American media were secretly removed by Reagan's men, and then they were scattered everywhere. Among them, 16 solar panels were installed on the roof of a cafeteria in a community college in Maine, and some of them traveled across the ocean to the hands of Comrade Huang Ming, an entrepreneur from Shandong, Texas.

The scene where Carter "handed over" solar panels to Huang Ming is quite symbolic. Because at the time of their handover, the center of the global photovoltaic industry has gradually moved to China, the industry has begun an unprecedented leap forward, and a number of world-class companies have emerged. The only thing that is slightly embarrassing is that Huang Ming and his company have not actually stood in the center of the photovoltaic stage.

Emperor Ming’s main product is solar water heaters, which should be the most familiar solar products for the common people. In the vast rural areas, every household has been proud of installing a solar water heater on the roof, but its main function is to "collect heat" rather than " Power generation". And with the deepening of urbanization (solar water heaters are not easy to install on buildings), this industry is also shrinking.

In addition to solar water heaters, the story is truly exciting. In the past 20 years, China’s photovoltaic industry has produced countless "richest-class" figures, such as Shi Zhengrong, Peng Xiaofeng, Li Hejun, Zhu Gongshan, etc. Nowadays, some of them are seriously injured, some Reverted to spectators, some were caught in debt turmoil, and some became most wanted criminals, so that some people ridiculed: "The richest man in photovoltaics is the most deadly man."

Leading companies are falling into the curse of falling, but China's photovoltaic industry can rise tenaciously. Why?

1/bubble: the end of the cruelty starts with cruel joy

In the spring of 2000, Shi Zhengrong, who studied under Professor Martin Green, the father of global solar energy, gave up his prosperous career in Australia and the life of Xiangche Villa. In spite of the opposition of his father-in-law, he returned to his motherland after more than ten years and joined the entrepreneurial army. In addition to a pair of wives and children, he returned to China with 3 cubic meters of technical data [3].

In order to find start-up funds, the 37-year-old took a briefcase and a laptop to visit Shanghai, Dalian, Hangzhou, Wuxi and his hometown Yangzhong under the scorching sun, and visited the government and VC. Everywhere he went, he would face 50 The multi-page PPT talked for a few hours, and the topic of the PPT was very micro-business: "Give me 8 million U.S. dollars, and give you a world-first enterprise [17]."

Unfortunately, the Internet bubble had just begun and the Nasdaq Index fell irrationally. The stocks of China’s three major portals were like waste paper, with stock prices as low as less than $1. International capital fled one after another, and some followed the "Silicon Valley model." Local governments that set up venture capital funds have also experienced serious PTSD, and they dare not make fun of taxpayers' money.

On the other hand, at the beginning of the century, real estate, automobiles, and home appliances were the bright snow in the eyes of the government. They paid a lot of taxes, and they also promoted employment. Industries such as photovoltaics, which are unfamiliar, unpopular, and vague in prospects, are obviously not to be seen. Shi Zhengrong eats for this. After a lot of closed doors, until I met Bole in Wuxi.

In 2000, Wuxi's GDP ranked 12th in the country, and it has also made rapid progress in emancipating the mind. In order to make a back analysis, the Wuxi city government set up a four-person team and went to Australia. On the one hand, he wanted to find out the background and composition of Shi Zhengrong, and on the other hand, he wanted to know whether photovoltaics had any prospects.

After getting a positive conclusion, Wuxi Suntech was formally established in 2001. Shi Zhengrong held 25% of the shares with technology patents and US$400,000 in cash, making him the first person to eat crabs in China. In the second year, the company's first 10-megawatt solar cell production line was put into operation, with a capacity equivalent to the total output of China's solar cells in the previous four years.

From a quantitative point of view, Shi Zhengrong almost reduced the gap between China's photovoltaic industry and foreign countries by 15 years. With this outstanding record, which is very suitable for the front page of the local daily newspaper, the Wuxi government is naturally overjoyed. The local leader once released a ruthless statement: "If anyone releases Dr. Shi, the municipal party committee and the municipal government will hold him accountable. "

Schematic diagram of the photovoltaic industry chain

In 2004, when Suntech’s products were nowhere to be sold, Europe sent divine assistance: Germany updated the “Renewable Energy Law” to compel photovoltaic power generation to be connected to the grid, and provided a subsidy of 0.45-0.62 euros per kilowatt-hour for a period of 20 years. Unprecedented efforts and demand blowout. Suntech got a lot of Euros and U.S. dollars in exchange for arranging production capacity in advance and stepping on the right spot.

In less than five years, Shi Zhengrong has come to the penultimate step of becoming a winner in life: In the second half of 2005, Shi Zhengrong had already decided to go public on the Nasdaq, but he did not expect that the listing plan was discovered by the CEO of the New York Stock Exchange and he immediately sent it out. Send Zhang Lei, the managing director and special representative-the future founder of Hillhouse Capital-to fly to Wuxi and Jiehu [3].

On December 14, 2005, the five-star red flag fluttered in front of the NYSE gate, and Wuxi Suntech became the first Chinese private company to be listed on the US Main Board. It raised nearly US$400 million, far surpassing Sina and Shanda. At the IPO dinner, Shi Zhengrong said excitedly: "Overnight the company produced more than 20 new millionaires." His wife Zhang Wei said to him jokingly: "From now on, I will never earn a point again. Money, I just spend it."

In 2006, Shi Zhengrong became the new richest man. In January of the same year, as a national enterprise that broke out of Asia, Wuxi Suntech’s listing experience report was held in the Great Hall of the People, and then twice appeared in the News Network in just two months. Shi Zhengrong He was also named "Economic Person of the Year" by CCTV. The British "Guardian" has a more peculiar perspective, naming Shi Zhengrong as "one of the 50 people who can save the planet."

Regarding the scenery of Wuxi Suntech, the local government is the most shocked. Everyone realizes that light can not only generate electricity, but also make money. So under the influence of the "Suntech Effect" and the "Wuxi Model", the local government started a crazy "chasing light" movement. At a time, more than 100 cities proposed to build "100 billion photovoltaic industrial parks", and many places were named "Photovoltaic City" or "New Energy City". In the early years of Jiaxing, Zhejiang, where clothing processing enterprises are densely populated, There was a saying that “weaving for ten years is not as good as doing photovoltaics for two years[18].” In Yiwu, the capital of small commodities, even Langsha, who produces socks and underwear, couldn’t help but want to come in.

In 2012, the "Chinese Entrepreneur" magazine made a high-level summary for this decade of "irrational prosperity" for photovoltaics: "In the past ten years, if there is an industry shrouded in a halo comparable to the Internet, it must be Photovoltaic; if there is an industry whose ability to generate wealth can rival the Internet, it must be photovoltaic; if there is an industry whose ability to attract capital can rival the Internet, it must be photovoltaic; if there is an industry that stimulates local governments’ pursuit of enthusiasm more than real estate , It must still be photovoltaic."

Like the Internet bubble at the beginning, the cruel joy will eventually end in cruelty, and the same plot will be staged again.

2/Gambling: Watching Saiwei now is like watching Jobs ten years ago

It took Wuxi Suntech from zero to the fourth largest photovoltaic company in the world for 6 years, and LDK for LDK took less than 3 years.

In 2005, 30-year-old Peng Xiaofeng was sitting on the Liuxin Group, the largest labor insurance company in Asia, with a net worth of more than 100 million yuan, but he was unwilling to produce low-end cheap products such as uniforms, gloves, vests and shoes for a lifetime. In May of that year, he and an official in Xinyu, Jiangxi, talked about photovoltaics. After the other party heard that he wanted to build a factory in Suzhou, he immediately reported it to Mayor Wang Dehe.

Wang Dehe, who had been the leader of a cigarette factory, sensed a business opportunity and immediately asked him to meet. Peng Xiaofeng said that he wanted to be a world-class enterprise, and he needed 500 million yuan in start-up capital, but he only used 300 million yuan at most, and the government needed to solve the rest. At that time, Xinyu’s fiscal revenue was only 1.8 billion yuan, and the city’s banks had loan authority. There is no 200 million in total. In order to win this project, Wang Dehe used various relationships to collect this huge sum of money for Peng Xiaofeng.

Peng Xiaofeng did not live up to the cultivation. In just two years, saiwei became the largest silicon wafer manufacturer in Asia, following Suntech’s listing in the United States, raising US$469 million, the highest in history, and becoming the first company in Jiangxi Province One month later, for companies listed in the United States, Savi returned 200 million yuan with interest to the Xinyu City Government. Xinyu has also become the city with the fastest GDP growth in Jiangxi.

After going public, saiwei, which is not bad for money, ushered in a period of rush. By the end of the first quarter of 2008, LDK had signed 6 large orders, and the orders were placed directly in 2018. The total order volume exceeded 13GW, which is equivalent to twice the global installed capacity of photovoltaic power that year. Another quarter has passed. The production capacity and sales volume officially surpassed Norwegian REC and became the world's first.

The speed is staggering, and this is inseparable from the loose external financing environment and Peng Xiaofeng's capital strategy: exchange money for time and fight a blitzkrieg.

A former employee of LDK LDK once said: “We bought out 70% of the supplier’s production capacity, which means that if other companies want to enter this industry, they can only get another 30% of the production capacity at most. That is to say. This year, it will never catch up with Saiwei[6]." A Xinyu official complained: "We got him 10 billion, 20 billion loans, he has not even invited us to eat a meal."

If you compare the photovoltaic industry to a hamburger, the bread at the two ends are silicon materials and power stations, and the meat in the middle is mainly silicon wafers, solar cells, and components, one after another. Peng Xiaofeng has an almost religious yearning for “first”. The silicon chip boss alone cannot satisfy his ambitions. His goal is to create an empire that connects all chains. Among them, the most difficult and profitable one is silicon. Materials are also the lifeblood of the entire industry.

Before 2008, most of the world's silicon material production capacity was overseas. With the sharp increase in the industry, the price has soared from 30 US dollars per kilogram in 2003 to more than 400 US dollars in 2008. The huge arbitrage space has also produced some craziness. The move: For example, the garbage dump of the Emei Semiconductor Factory in Sichuan was turned upside-down by the "silicon digger".

At that time, there was no such thing as a "stuck neck". The outside world's evaluation of China's photovoltaic industry was "two ends" (raw materials and market). There is a very vivid saying that China's photovoltaic industry is an industry that depends on the sky for food, but it depends on the sky of foreign countries. As long as a foreign country sneezes, Chinese companies will have a bad cold.

In order to get rid of the dilemma of "waiting for the rice to go to the pot", domestic photovoltaic companies signed an "unequal treaty" with overseas manufacturers to lock in volume and price while embarking on the silicon material business, but among them, Peng Xiaofeng, who has the strongest gambling and the biggest strides It must be. At the beginning of 2008, saiwei invested more than 12 billion yuan to build a 15,000-ton silicon production line in Mahong Town, Xinyu. At that time, the global silicon material price was speculated to a historical high of US$500/kg, and the design cost of the Mahon factory was only about US$30/kg. If it can be put into production smoothly, it means that saiwei will have a banknote printing perpetual machine. , Peng Xiaofeng will also become a major contributor to the entire industry.

However, with the outbreak of the financial crisis, demand for photovoltaics shrank sharply, and product prices plummeted. In just one year, the price of silicon materials dropped from more than US$400 to US$50 per kilogram. The capital chain of the Mahon factory, which was originally able to pay back within one year of production, instantly became tense. However, the daring Peng Xiaofeng of Yigao did not rein in the brink, but chose to increase leverage and expand production capacity.

Silicon price trend

In August 2010, saiwei opened a 1.6GW cell factory in Hefei, which was the world's largest one-time photovoltaic project that year. In 2011, saiwei announced an investment of 10 billion to build the world's largest silicon production base in Inner Mongolia, with an annual output of 60,000 tons, which is four times that of Xinyu.

However, as everyone knows, LDK was already extremely tight in its capital chain. In the fourth quarter of 2011, it lost US$589 million, its asset-liability ratio was as high as 87.7%, and its debt was US$6 billion. The annual interest payment alone was US$200-300 million, but even In this way, Peng Xiaofeng, who was already at the end of the road, refused to bow his head.

In an interview with Southern Weekend in 2012, Peng Xiaofeng severely criticized the foreign powers represented by Wall Street: "They (analysts) have never seen a great company right. Now the industry looks at saiwei, It’s like watching Jobs 10 years ago."

In the same year, European and American countries launched a “dumping and countervailing” (anti-dumping and countervailing) investigation on Chinese photovoltaic products. The global installed capacity plummeted and the entire industry was wailing. This became the last straw that crushed 赛维. Since then, the Ma Hong factory has ceased production for two years, and people go to the headquarters to collect debts every day. The Hefei factory is sold to Tongwei, who started as a fodder, and the arrogant Peng Xiaofeng is forced to resign. In 2016, Sunway was ruled by the court for bankruptcy and reorganization, and Xinyu's GDP growth rate also fell to less than 5%, and the story of rapid growth and death came to an end.

There are different opinions on the failure of Saiwei. Some people think that external factors are the key. However, more people think that it is because Peng Xiaofeng is too gambler and blindly self-confident. They believe that the secret of industry success is scale. As long as the front is drawn long enough, the production can be achieved. If it is too big, the opponent will never catch up, and the company will never fail. But the actual situation is not the case: take silicon as an example, because technology will continue to advance, the latest factory is the lowest cost, not the largest.

Li Xianshou, the founder of Yuhui Sunshine, wrote an article in 2012 called "True Lies", exposing the crazy side of the industry. "The photovoltaic industry is literally guided by'striving for hegemony in the martial arts, dominating the world', and'expanding production' as a means, imperial power thinking and the style of the Great Leap Forward... How easy is the production capacity, as long as there is money; how easy is the shipment, as long as the price Low enough; but what did I get? Except for ranking! We have already fallen into the viciousness of expansion, price reduction, revenue decline, and continued expansion.

Circular, sinister human nature is the natural enemy of this industry. "

3/Illusion: Go your own way, leaving others with nowhere to go

On October 10, 2012, the US Department of Commerce announced that it would impose tariffs of 34% to 47% on photovoltaic products imported from China. At the same time, the EU formally initiated anti-dumping and countervailing investigations. At that time, Europe was the largest in China’s photovoltaic industry. The export market accounted for about 70%, and the United States accounted for 10%. For a while, everyone was facing a big enemy.

In November of that year, the "Dialogue" column of CCTV made a special program for this purpose, called "The Secret of the Photovoltaic Blood War", and invited the top leaders of Tongwei, GCL and Hanergy Group to discuss the whole process, only Hanergy The founder Li Hejun was the most relaxed. When talking about speculation, he couldn't help but cocked his legs. The reason is not difficult to understand: At that time, the "double reverse" was aimed at crystalline silicon products, while Hanergy made thin films, unscathed.

Regarding the "double reverse", most people understand that with their own hard work and wisdom, the Chinese have stood at the top of the industry's pyramid in just ten years and have stolen the cakes of European and American countries. Therefore, European and American countries have to suppress China. Human momentum. But Li Hejun believes that there is a huge conspiracy hidden in it.

In Li Hejun's eyes, the reason why European countries are cutting subsidies while imposing high tariffs on Chinese products is not at all to support local crystalline silicon companies, but to seize the commanding heights of the new generation of technology, that is, thin films.

There are two technical routes for photovoltaic power generation: crystalline silicon and amorphous silicon, the latter mainly refers to thin films. Compared with crystalline silicon, the advantages of thin film are light and thin, low silicon consumption, less production process, low temperature coefficient, and good low-light effect. In addition, because of its flexibility, the application scenarios are broader, especially in construction, 3C electronics, automobiles, etc. But the disadvantage is that the conversion efficiency is not high, and the cost-effective advantage is insufficient, so it is relatively unpopular.

In 2009, Hanergy officially entered the photovoltaic industry through thin films. At the company's annual meeting that year, Li Hejun delivered a speech called "I Have a Judgment". He predicted that there will be "a piece of dead corpse on the road of crystal silicon in the future." ]". To some extent, Li Hejun's prediction is correct.

The "double reverse" caused a large number of domestic photovoltaics to go bankrupt, including some small handicraft workshops, as well as giants such as Suntech and Saiwei. It also caused value speculators like Langsha to give up the idea of intervening. But this does not mean that the crystalline silicon has never recovered, and the film can easily counterattack.

In fact, the opposite is true. Due to the collapse of global polysilicon prices, the cost of silicon materials was only US$22 per kilogram in 2012. With the release of new production capacity, the cost of crystalline silicon cells dropped by 40% within a year, and the cost advantage of thin films was lost. Exhausted, becoming more and more niche.

At present, the entire industry is still dominated by crystalline silicon, and the proportion of thin films has returned to the same 5% as it was 15 years ago. In addition, there are only two major players in the world, First Solar and Hanergy, which is completely contrary to Li Hejun's original prediction.

Li Hejun, who knows nothing about technology, felt that the cost and conversion rate of thin films could all be solved by technology, so he gave up the crowded crystalline silicon track. In fact, when Li Hejun was choosing the technical route, someone inside of him put forward an idea: to build a crystalline silicon plant next to Hanergy's hydropower station to use the power price advantage to crush competitors and make quick money, but Li Hejun vetoed it.

You know, before moving to photovoltaics, Li Hejun was mainly engaged in the hydropower business. His most proud work was the Jin'anqiao Hydropower Station, which is 10% larger than the Gezhouba Hydropower Station. This world's largest private hydropower station is regarded as Hanergy’s money printing machine. , Contributing billions of cash flow steadily every year, this is why Hanergy spends tens of billions of dollars to bet on the strength of the film. In less than two years, Hanergy has established nine manufacturing bases across the country. In 2011, through capital operation, it controlled the Hong Kong-listed equipment manufacturer Bo Yang Solar (later renamed "Hanergy Film"), opened up financing channels, and then acquired three overseas thin-film solar companies in less than a year.

Li Hejun believes that these acquisitions are all successful bargain hunters: "More than 700 photovoltaic companies in the world and the most advanced thin-film technology are in our database. We have selected 5 of them. As long as we master them, the global thin-film technology will be the commanding heights. I'm in control."

Boosted by the good news, Hanergy’s share price soared from HK$0.33 at the end of 2012 to the highest HK$9.05 in March 2015, an increase of 26 times. Li Hejun's worth surpassed Ma Yun in one fell swoop and became the new richest man in China after Shi Zhengrong. .

Compared with the richest man in the past, Li Hejun's brains are relatively more peculiar. He believes that the future of the photovoltaic industry is not a centralized power station located in the northwest desert, but a roof and countless life scenes. His ultimate goal is to let 1.4 billion Chinese people use Hanergy's "film family bucket"—— Use Han walls and Han tiles to build houses, drive Hanergy’s solar-powered cars to work, carry Hanbags for business trips, and hide under Han umbrellas to enjoy the cool in summer.

Most people who work in photovoltaics have the habit of talking harshly. Li Hejun once told a famous entrepreneur: "When do you give up ground power stations, when will you really understand what is called photovoltaics [14]."

On March 9, 2015, Li Hejun spoke at the two sessions as a representative of the Chinese People's Political Consultative Conference, which became one of the most glorious moments in his life. However, this speech was bombarded by another member of the Chinese People's Political Consultative Conference, Jian Xiong, who thought it was for his listing. The company advertises. In the current words, it is live broadcast and delivery, and it is in the Great Hall of the People.

Soon after, the hidden corner of the listed company was also torn open. On May 20, 2015, the suspected operating stock price was investigated by the Hong Kong Securities Regulatory Commission due to a large number of connected transactions. The stock price of Hanergy's thin film power generation plummeted by nearly 50% in one day, and the market value evaporated more than 140 billion Hong Kong dollars within 20 minutes.

Since then, Hanergy has entered a 4-year suspension period, and Li Hejun has not been able to get rid of the fate of the richest man in photovoltaics: In June 2019, Hanergy Film was officially delisted from Hong Kong. Since then, Hanergy’s business has not improved much, the capital chain has continued to deteriorate, and it has frequently fallen into arrears and debts. The "Cash Cow" Onqiao Hydropower Station has also been auctioned, and Hanergy’s return to A is nowhere in sight.

In this big bet on the technical route, crystal silicon won a big victory. Li Hejun’s previous "121 plan" (by 2020, Hanergy will have a revenue of 1 trillion, a market value of 2 trillion, and a profit of 100 billion) has long been in vain. , Leaving only a lonely back and a meaningful sentence: "Either we die or we are great."

4/ Fate: the "king of the inner" well-deserved

Although some people compare photovoltaics with the Internet, no matter how wild they are, the essence of photovoltaics is manufacturing. It is hard to escape the fate of cost if you do manufacturing in the world's factory.

Shi Zhengrong once had a classic argument about this: "As long as the Chinese sell any product, it will sell until it loses money; as long as the Chinese buy any kind of raw material, it can be bought at hundreds of times the high price. "

The cruelty of the photovoltaic industry is that it is not enough to win the civil war, because its opponent is a thermal power plant. The ultimate goal is to achieve "parity on the grid" (compared to the benchmark price of coal-fired grid electricity) before reaching this historic turning point. , Enterprises must invest desperately, buy equipment, expand production capacity, overcome technical problems, and continue to revolutionize their lives.

From the start of production of Suntech’s first battery line in Wuxi in 2002 to 2012, when Europe and the United States initiated double-reverse operations, the cost of photovoltaic kilowatt-hours in China dropped from RMB 5/kWh to RMB 0.8/kWh (at the time, the benchmark electricity price for coal-fired grids across the country). From 0.23 to 0.5 yuan per degree).

China's PV cost trend

If it is changed to other industries, the cost will drop by 85% in ten years, the industrial structure will be basically stable, the oligarchic effect will be formed, and profits will begin to emerge. But this is not the case with photovoltaics. Before achieving parity on the Internet, the entire industry can’t talk about a set pattern, and the power of the leader is sometimes only a flash in the pan.

After the fall of Saiwei and Suntech, the entire industry ushered in a major reshuffle, and the main battlefield was also transferred from overseas to China. The former "private electric power king" Zhu Gongshan took over the banner of "world silicon king" from Peng Xiaofeng's hands. . Around 2015, the "energy empire" of the GCL system he was in charge of became the world's largest silicon material and wafer manufacturer, accounting for about a quarter of the world's market share.

However, this status has been subverted by "a thread".

In 2015, the state launched the "Lead Runner Program", which put forward higher requirements on the conversion rate of photovoltaic modules. At that time, 80% of monocrystalline products can meet the above requirements, while only 20% of polycrystalline products can meet the above requirements. There is a clear policy tilt. This is considered to be the country's intention to guide the entire industry from low threshold polycrystalline to higher efficiency. The single crystal route to accelerate the industry’s self-blood production.

In China, some money can be made from the market, and some money can be made from reforms. With the implementation of the top-level supply-side reform, Longi, which has always adhered to the monocrystalline track and once served as a supplier of Wuxi Suntech, has surfaced. It was also around 2015 that Longi made a huge breakthrough in silicon wafer cutting technology.

In the photovoltaic industry, the thickness of the upstream silicon wafer and the loss during cutting are the first decisive factors affecting the cost of crystalline silicon cells and even the cost of grid-connected power generation [12]. The diamond wire technology adopted by Longi significantly improves the efficiency of silicon wafer cutting and reduces the non-silicon cost in the production process of silicon wafers. Longi’s founder Li Zhenguo once explained, “Using mortar to cut one ton of silicon rods will consume 300 kilograms of steel wire, 300 kilograms of silicon carbide, and 300 kilograms of polyethylene glycol. Kilogram diamond wire."

With the advancement of technology, the support of policies and the maturity of the supply chain, the cost-effective advantage of monocrystalline has been continuously improved, and the market demand has grown geometrically. In just five years, the market share of monocrystalline has increased from less than 20% to 9% today. to make.

With this wave of technology, LONGi started a frantic expansion. Its stock price has doubled 25 times in more than 5 years, leaving its counterparts listed in the United States far behind. Last year, it became a global silicon wafer and component link dual-material "world". "Champion", with a net profit of up to 8.5 billion yuan, was once named "photovoltaic Mao" by shareholders.

Having said that, photovoltaic and Maotai are essentially two species. The Chishui River flows forever, but in the photovoltaic industry, the only constant thing is that technology will continue to improve, and what is always changing is the industrial pattern.

On the one hand, the popularity of the diamond wire has accelerated the advent of the era of affordable Internet access. At the same time, it has also plunged the entire industry into a turbulent cycle of production capacity replacement: the former "silicon king" GCL-Poly was beaten with a swollen nose and swollen old production lines. Devaluation can only be sold on the basis of "jin". After experiencing the decline of the "5.31" subsidy in 2018, GCL was even more injured. Its stock price continued to fall and it had to sell the power station to continue its life.

The position of Longji itself is by no means stable: the most interesting thing is the size dispute in the silicon chip segment. Companies led by Zhonghuan and Trina Solar form the 210 camp to challenge the 182 composed of Longji, Jinko and JA. In the camp, if the challenge is successful, the quality of Longi's "Moutai" will be greatly reduced.

In the silicon material segment, GCL-Poly hopes to turn things around through "granular silicon". In the cell field, Tongwei, Aixu, Hanergy, and even Mingyang Smart, which is a wind power company, are also vigorously promoting the mass production of HJT (heterojunction battery) with a higher conversion rate. Every small technological advancement is a variable of the industry structure.

In short: the core of the photovoltaic industry is the cost advantage brought about by technological iteration. The emergence of new technologies means that new capacity will defeat old capacity, and investment costs will even be lower than the residual value of old capacity. At the same time, because the first movers cannot keep up with the new round of technological upgrading due to huge capital expenditures and excessive debt ratios, the "first mover advantage" may become a "first mover disadvantage."

All the players in this industry, from the government to the enterprise, from upstream to downstream, paid all the "prices" in exchange for the continuous reduction in the cost of photovoltaic power generation. Every time a new technology matures, it will bring an industry reshuffle, and it will also witness the coronation of the new king and the retreat of the old king.

Of course, the only thing that does not change is that the world has taken a small step forward from truly clean energy. Although the motivated richest people, most of them have become "prices."

5/End

In the era of the Industrial Revolution, coal was called industrial food, and oil was called industrial blood. There was no food in my hands, my heart was panicked, my body was bloodless, and my life was dead. However, the distribution of traditional fossil energy sources and the imbalance of supply and demand have caused many geopolitical issues and even became the fuse of wars. The Franco-Prussian War, the Gulf War, and the Iraq War are countless.

In order to avoid such fierce conflicts and achieve energy independence, since the 21st century, many countries have begun to take photovoltaics and other new energy sources as strategic industries. The United States, Germany, Spain, Japan, and China are as good as they are. No country hopes to hand over its own destiny to others. Here, become a lamb to be slaughtered.

If you strip off the eccentricities of the photovoltaic industry in the past two decades, you will find that the biggest winner is actually China’s photovoltaic industry itself. After 2019, China's photovoltaics have officially entered the "Era of Parity Internet Access". In places with good light conditions, the online price is already lower than that of thermal power. The competitiveness of the entire industry continues to increase. Last year, China's newly installed photovoltaic capacity was 48.2GW, accounting for 30% of the world. At the same time, the export destinations of China's photovoltaic modules are very scattered, and the worries of "stuck necks" have disappeared.

In the global competition for the photovoltaic industry, whether it is silicon materials, silicon wafers, cells or modules, whether it is market share or technical strength, China is absolutely No. 1 in the world. No matter how the technical route changes in the future, it is certain that , The final winner must be the Chinese company.

In the 2016 issue of "Dialogue", Shi Zhengrong was invited to the scene as a "defeated soldier". Before that, he had been alone in Australia for several months, driving, shopping for vegetables, cooking by himself, and lost 15 catties. , He said: "The success or failure of a company is not important, but the most important thing is to achieve an industry."

Looking back at the past two decades of China's photovoltaic industry, this may be the most appropriate summary of the submissions.