makes a big statement! Talking about overcapacity and the dispute over photovoltaic technology - an exclusive conversation with the leading photovoltaic leader Liu Hanyuan
China Fund News reporter Feng Yao
In the past year, the photovoltaic industry has seemed somewhat "split".
From a macro-industry perspective, the industry's prosperity still maintains a rapid growth trend with the advancement of dual-carbon goals and the increase in demand for new energy at home and abroad.
Statistics from the China Photovoltaic Industry Association show that the output of polysilicon, silicon wafers, cells, and components will reach 1.43 million tons, 622gw, 545gw, and 499gw respectively in 2023, a year-on-year increase of 66.9%, 67.5%, 64.9%, and 69.3% respectively.
However, with the rapid development of the industry, involution and overcapacity have also emerged. The upstream silicon materials and silicon wafer end are the first to reap industry dividends, and are also the first to feel the "chill".
After the beginning of 2023, the price of silicon materials rebounded briefly and continued to accelerate downward. Silicon material prices rebounded to a certain extent after briefly bottoming out in June last year, but fell again on November 8, falling below 60,000 yuan/ton. Silicon wafers, which are also upstream, also closely follow the price trend of silicon materials.
The upstream segment of photovoltaics has experienced a "roller coaster" price trend.
In terms of industry players, although the entire industry is still on an upward trajectory, the profitability of some companies is far from optimistic. Recently, even some leading companies have postponed or reduced the production of cell and polysilicon projects, and there are also cross-border players who have left the market sadly. Amidst the violent fluctuations in the
industry, there are naturally many differences in the market and a lot of controversies. In this context, the research and judgment of industry leaders often become the "wind vane" of the market and point out the direction for the industry.
Based on this, during the National Two Sessions, China Fund News conducted an exclusive interview with Liu Hanyuan, deputy to the National People's Congress, vice chairman of the All-China Federation of Industry and Commerce, and chairman of the board of directors of Tongwei Group. As the helmsman of Tongwei Group, Liu Hanyuan talked about a number of topics of widespread market concern in the interview, including the dispute over photovoltaic technology routes, the trade-off between the integrated model and the professional division of labor model, and the overcapacity issue that is widely concerned by the market. .
Regarding the dispute over technical routes, Liu Hanyuan believes that topcon may become the mainstream product structure in 2024 and 2025. At the same time, Tongwei will continue to improve various existing technical routes in the future and continue to research forward-looking technical routes. "Small trials and pilot trials will be organized and participated."
talked about the trade-offs of the business model, He believes that integration may have advantages, but between integration and professional division of labor, the industry should understand each other and do something and not do something. In his words, “We want to be a good ‘workshop director’ for everyone.”
Regarding the issue of overcapacity, believes that under market conditions, overcapacity is the norm, while shortage is the abnormal state. "All investment and demand are constantly balancing, excess, and rebalancing, in a spiral movement over and over again."
Interestingly, after resigning as chairman of Tongwei Co., Ltd. and handing over the "baton", Liu Hanyuan expressed his views on Tongwei Co., Ltd. Wei shares' young management team expressed high recognition. Liu Hanyuan said frankly that in the coming days, he may play more of a "behind the scenes" role: "We are more looking at the general direction and restricting what cannot be done."
1.
How to shift from the aquatic feed industry to the photovoltaic industry?
China Fund News: Tongwei Co., Ltd. under your leadership has become a banner in the photovoltaic industry. Looking back, in the early days of Tongwei's listing, why did Tongwei suddenly shift its "head" to the photovoltaic track? After all, this is far from the company's original aquatic feed industry.
Liu Hanyuan: Looking back on the development history of Tongwei, what society needs, what we can contribute to it, and what we can do well are our final foothold in choosing an industry. Different development periods have different social development needs.
Tongwei's two industrial choices were one of the biggest needs of society at that time, and they are bound to be demands that will not diminish in the foreseeable cycle.
solved the problem of "difficulty eating fish" at an early stage and deeply cultivated the aquatic feed industry.Against the background of environmental degradation and energy revolution, we have vigorously promoted the layout of the photovoltaic industry, created a complete photovoltaic new energy industry chain with independent intellectual property rights, and pioneered the world's first "fishing and photovoltaic integration" model to achieve efficient synergy between new agriculture and new energy. One focuses on the most basic food security, and the other focuses on future energy security.
In 2002, I studied as an MBA student at the Guanghua School of Management of Peking University. After graduation, I continued to study for a PhD in Business Administration from the School of Economics. My doctoral thesis was "Comparative Research on Various New Energy Resources and my country's Energy Strategic Choices." At that time, China’s haze problem had not yet been taken seriously, and we were already thinking about where China’s energy opportunities would lie in the future. After studying coal, oil, hydro energy, wind energy, nuclear energy, etc., we found that photovoltaic power generation, the shortest path, largest reserve, inexhaustible and extremely low-cost future energy, is almost is the only option.
finally entered the photovoltaic industry in 2006 after rational analysis and scientific judgment. Moreover, as the scale of the industry gradually increases, costs gradually decrease, and conversion efficiency further improves, photovoltaics have become the lowest cost among all types of energy production methods.
In the context of carbon neutrality, the photovoltaic industry will play a very important role in promoting China's primary energy transformation. The first is to effectively support China's energy transformation and the realization of "double carbon" goals from an industrial perspective; the second is that in this round of global ecological low-carbon and high-quality development, China will firmly become the number one country driving the energy transformation of all mankind. , prompting our entire country’s products, industries, and capital to go global.
China Fund News: Looking back, Tongwei’s transformation was very successful. After Tongwei's transformation, many listed companies successfully transformed into the photovoltaic industry, but more companies did not go so smoothly. As a pioneer in successful transformation, what experiences can you share?
Liu Hanyuan: Enterprise development must always be serious and clear-headed. You cannot enter an industry based on imagination alone. You must choose potential industries that are in harmony with social needs and future development. The key is to truly judge whether you can enter and stand like a nail in this industry, and think about whether you can continue to be among the top three.
In addition, for enterprises, strategic determination is extremely important in order to overcome all kinds of development fog, eliminate all kinds of temptations, and deal with all kinds of doubts.
China’s photovoltaic industry has faced fierce competition from around the world since its birth. More than ten years ago, China's photovoltaic industry was in a situation where the market, core raw materials and core technology were "outside". During the development process, it encountered major blows such as the European and American double-crossing and the global financial crisis, and once fell into a development bottleneck period.
Photovoltaics is a technology-intensive industry, and R&D investment plays a key role in the development process of the company. In terms of technology research and development, Tongwei has invested a lot of resources.
In the first half of this year, Tongwei Global Innovation R&D Center will be completed and put into use. The project consists of ten modules including laboratories and photovoltaic testing centers. The newly built R&D workshop covers an area of more than 70,000 square meters. It will mainly carry out research on new battery and component technologies and key core technologies. R&D and pilot testing provide technical support and patent reserves for the industrialization of next-generation high-efficiency batteries.
2.
talks about the integrated and specialized division of labor model:
wants to be a good "workshop director" for everyone
China Fund News: We have seen that since Tongwei entered the photovoltaic industry, it has expanded from the polysilicon material link to the downstream, extending In terms of silicon wafers, cells, and components, an integrated layout has been completed. In your opinion, is the integrated layout the best business model for Tongwei in the future?
Liu Hanyuan: In the past, everyone had a lot of entanglements about division of labor and integration. In the current environment, everyone believes that integration has more advantages. Tongwei has basically completed the integration process in 2022 and 2023. From the earliest polysilicon to rod slicing, cells, and components, and now to the industrial silicon link that is now being improved, Tongwei may be one of the companies with the longest integrated chain and the most connected links in the industry.
Tongwei has expanded to form a global supply chain with leading scale cost, transaction cost and organizational cost in terms of supporting coordination. However, Tongwei has always emphasized the importance of professional division of labor and professional partners, and has always advocated effective division of labor and collaboration in the industry, so that customers and friends can have strengths and choices, and work in what they are good at. Make it bigger.
Therefore, we should cooperate effectively where others specialize, control appropriately and rationally, and create a business ecosystem of "do something, do something not to do; you are good for me, and I am good for you". The integration of
may have advantages, but between integration and professional division of labor, how can everyone understand each other, do something and not do something, make what they specialize in stronger and bigger, and support others? Make what we specialize in stronger and bigger, maintain a reasonable degree of competitiveness in the industry, and have division of labor and collaboration with each other. This is a proposition that needs to be answered before all industry colleagues in 2024.
If this proposition is answered well, China's photovoltaic industry can not only maintain global competitiveness, but also have enough rationality and a good business atmosphere and ecology. It will not only develop better domestically, but also advance in the global market. The global energy transition will be more rational and efficient.
China Fund News: In recent years, Tongwei has also actively cooperated with peers in some aspects, including cooperating with Longi to invest in the construction of polysilicon production capacity in 2020, and cooperating with Trina Solar in 2020, and later with Jinko and Jingyuntong Cooperation has also been achieved in terms of polysilicon production capacity. In the context that the polysilicon material segment already has a large market share, why would Tongwei choose such cooperation?
Liu Hanyuan: From public information, we can see that five or six years ago, or even longer, we have been advocating industry division of labor and mutual collaboration. How can we participate in international and domestic competition? What attitude makes collaboration work better? It is worth discussing, promoting, or at least trying together with colleagues in the industry.
Three or four or five years ago, we fully opened up equity cooperation to major players in the industry, including the top three and top five component manufacturers, in the high-purity crystalline silicon segment where we specialize, specialize, and excel. In fact, this is a very good way. We are relatively strong in a certain section, and others are strong in a certain section. If others support us in making this section bigger and stronger, we support others in slicing the rods and components. The links are made bigger and stronger. In fact, this is an effective way of cooperation and division of labor, which can have a very positive impact on the industry ecology.
Therefore, LONGi and Trina have also invested in our high-purity crystalline silicon segment, and Jinko and Beijing Express have also invested in our segment. We want to be a good "workshop director" for everyone, so that everyone can rely on good product quality, competitive costs and the advantages of scale to display their talents in the international market. In this way, everyone has something to do and something not to do, and the cooperation will truly have effective and positive industry significance.
has done this in the past, and everyone has also felt the significance, results, and investment benefits of cooperation. Now, everyone's view is that this division of labor and cooperation is still correct, and it is not inconsistent with integration. Even in the process of integration, if the division of labor and cooperation are done well and made stronger and bigger, it can effectively support and support the subsequent integration and participate in international competition more effectively.
3.
Discuss the dispute over technical routes:
topcon may be the mainstream structure in the past two years
China Fund News: Currently, there are many technical routes extending in the cell sector. In addition to topcon, it also includes heterojunction hjt and back Plate BC batteries, especially BC batteries, were discussed a lot in the market last year. What do you think of the technical route selection for the battery cell link? How will Tongwei do multiple-choice questions in the future?
Liu Hanyuan: In the past two years, especially in 2023, the proportion of n-type products has increased significantly from a small amount at the beginning of the year to the middle of the year. By the end of the year, basically 2/3 or 3/4 may already be n-type topcon. Everyone has also seen that heterojunction technology has also received 10 GW, 20 GW, and 30 GW of possible investment and investment in 2023, and the conversion efficiency of the product has also improved.
Against this background, topcon will become the mainstream n-type product structure of batteries in early 2024. The sales proportion may increase significantly in 2024, and the conversion efficiency of the product may also increase significantly. In this process, topcon may become the mainstream product structure in 2024 and 2025. In technologies such as
heterojunction and ibc, there may be more than 10 GW or 20 GW of investment in this process. If product efficiency keeps up and cost and yield can be taken into consideration, we will also participate in this process.
In 2022 and 2023, research on the composite application of perovskites is also in full swing, with some conversion efficiencies reaching or even exceeding 30%, bringing hope to the industry for a lot of conversion efficiency and future development space. In this process, the battery may face constant iterations of equipment and technology, and it may also increase the risks of the investment process, especially the risk of production line silence, cost silence, and the risk of being eliminated and iterated.
Therefore, industry colleagues, new and old participants, must pay attention to the risks that may arise from this part, carefully participate in the selection of technical routes, and determine the scale and intensity of investment, so that we can seize opportunities and avoid them. risk. For us at
, we are currently working hard to expand and improve the innovation R&D center. The project started construction in Shuangliu, Chengdu on November 30 last year. After completion, the innovative R&D center will form the most concentrated field of crystalline silicon cell research in China and the world, and will continue to improve various existing technical routes. We will organize and participate in the conceptual research, small tests, and pilot tests of future forward-looking technical routes to better lay out the direction of technical routes, forward-looking paths, and the implementation of commercial application technologies.
4.
Talking about overcapacity:
Under market conditions, overcapacity is the norm.
China Fund News: Last year, product prices in all aspects of photovoltaic products fluctuated violently. Initially, it was also passed down from polysilicon materials and silicon wafers. In the market, " There are also many voices saying "overcapacity". What do you think of this phenomenon? For example, in terms of polysilicon materials, do you think the current market price is within a reasonable range?
Liu Hanyuan: The industry now generally believes that the photovoltaic industry has experienced overcapacity after a new round of upsurge. Maybe the ideal state is irrational, but looking at the laws of the market, it is very normal.
Under market conditions, overcapacity is the norm, while shortages are the abnormality. All investment and demand are constantly balancing, excess, and rebalancing, in a spiral movement over and over again. Let the market handle market matters as much as possible. The essence of a market economy is to discover and balance demand, as well as the iterative process of investing, reducing investment, and expanding investment. Therefore, we think the current situation is normal.
Faced with such a situation, for enterprises, the first is to improve their internal skills. In our polysilicon production process, we must think about what kind of methods can further reduce the consumption level, what kind of methods can further improve the quality of products, and what Accelerating transformation at such a speed can better adapt to the back-end demand for product quality and structure, allowing us to participate in more opportunities in the industry.
For the market, what kind of method can make the industry face the periodic impact more rationally, and each other can do something and not do something during this process, and strengthen the collaboration and cooperation of the industry, so that this process can be better and gentler , being able to get through it smoothly is worthy of our common thinking both internally and externally.
Moreover, compared with an emerging industry that still has enough room for growth in the future, today's excess and new balance are just a small wave in the development process.
If you do some calculations rationally, you can find that in 30 years to achieve the main energy transformation and carbon neutrality goals of mankind, the scale of the photovoltaic industry may be more than 10 times that of today, and more than 10 times that of today. Space is not a scale that will be realized in 100 years or 1,000 years, but an energy transformation that will be widely applied and completed within 30 years.
Therefore, from this perspective, today’s so-called excess and balance are short-term. In the long run, the essential need is to be able to effectively promote energy transformation.Regardless of whether we look at it from all aspects of government, industry, or industry, today’s objective facts should be viewed in a positive light.
5.
Talking about succession:
Originally planned to complete this matter at the age of 45
China Fund News: As early as 2018, you resigned as chairman of Tongwei Co., Ltd., and Tongwei’s management has actually achieved a "handover" . Judging from the years of operation, how effective do you think it is? Does it meet original expectations? After handing over the baton, what are your next plans personally?
Liu Hanyuan: My original plan was to complete it at the age of 45, but it has been 9 to 10 years overdue. The rejuvenation of personnel and the echelonization of teams are the long-term stability of the company and are also reasonable needs for the appropriate matching of talents.
Nowadays, most of Tongwei’s core managers are born in the 1970s, 1980s and even the 1990s. They are young people who do things better than I imagined and better than the industry expected. They also have the confidence and interest to continue to do a good job. The company team is full of vitality and vitality, and the integration ability of the entire team is very good.
Therefore, as long as they can do well, I will 100% support and create conditions for them to do better. In the future, we will pay more attention to the general direction and restrict what cannot be done.
Editor: Joey
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