The Era of Stock Competition for TOPCon Solar Cells Begins as Top-Tier Enterprises Take the Lead in Technological Transformation to "Confront" BC Cells

In November this year, two top-tier BC enterprises, LONGi Green Energy (601012.SH) and AIKO Solar (600732.SH), formed an "alliance" to challenge the "mainstream status" of TOPCon cells. They forecast that BC's market share will reach 50% by 2027-2028 and are confident that the mass production efficiency of BC cells is expected to exceed 27.5%.

As the current dominant PV cell technology with over half of the market share, TOPCon cells have entered a "defensive battle." Since the beginning of this year, TOPCon cells have rapidly replaced the previous generation PERC cells, with significant improvements in conversion efficiency. In late November, Trinasolar announced that its PV cell efficiency had reached 26.58%. This marks the first time that the efficiency of n-type TOPCon cells has surpassed the 26% threshold, with module power increasing by 30-40W.

According to industry statistics, the capacity of TOPCon cells exceeds 800GW. However, amid the current supply-demand mismatch, internal competition is also intensifying. TrendForce divides the development of TOPCon technology into three stages, with the focus of the 2.0 stage being the breakthrough of the bifacial passivation structure.

Among enterprises primarily adopting TOPCon technology, Jinko Solar (688223.SH) announced that the maximum conversion efficiency of its third-generation Tiger Neo series modules has reached 24.8%, with a bifacial rate of up to 85% for the bifacial module version. Trinasolar (688599.SH) announced in late November that its PV cell efficiency had reached 26.58%, with the mass production efficiency of medium-sized modules reaching 24.8%.

After nearly two years of promotion, TOPCon cells have achieved significant efficiency improvements, but generational differences may also emerge internally. Chen Yifeng, Vice President of Trinasolar, told a reporter from CLS that although many enterprises currently have the capability to build TOPCon cell capacity, not all of them will master the critical technologies required for further efficiency improvements in the future. Their production lines may face the risk of being eliminated by the market due to outdated technology.

TOPCon Cells Enter Stock Competition

According to TrendForce data, by the end of 2024, the TOPCon technology route will have captured approximately 70% of the market share, with most top-tier enterprises opting for this technology route.

However, amid the ongoing differentiation and reshuffling in the PV industry, the capacity expansion of TOPCon cells, which began on a large scale in 2022, has significantly slowed this year. According to data from the China Photovoltaic Industry Association, in the first 10 months of this year, the growth rate of domestic capacity slowed significantly, with the number of projects put into operation, under construction, or planned decreasing by more than 75% YoY. Among the four main segments—polysilicon, silicon wafers, cells, and modules—solar cells experienced the most significant decline. In 2023, China's cell production reached 545GW, up 64.9% YoY.

With capacity expansion halting, TOPCon cells have entered a stock competition phase. Facing the capacity expansion of BC cells, top-tier enterprises face greater pressure to improve efficiency.

According to Zhang Yingbin, Head of Strategic Products and Markets at Trinasolar, the planned capacity for TOPCon technology is approximately 800GW. After categorizing this capacity and excluding ineffective capacity from cross-industry or unbuilt projects, the actual effective capacity is around 600GW. Among these, the capacity of top-tier enterprises is between 300-400GW, playing a leading role.

Zhang Yingbin believes that the total capacity of TOPCon is already sufficient, and it is crucial to make good use of the existing capacity. On the manufacturing side, those with substantial TOPCon capacity will prioritize upgrades over new construction. He emphasized that especially for second- and third-tier producers aiming to "overtake on curves" with new technology routes, careful evaluation is essential. Given the industry's thin profit margins, the payback period for new projects is critical. Therefore, the focus should be on maximizing the utilization of existing capacity.

Based on empirical data provided by Zhang Yingbin, in various scenarios such as large-scale ground-mounted power plants in Qinghai and Spain, as well as distributed and commercial-industrial scenarios in Fujian and Germany, TOPCon 2.0 offers up to 0.27 yuan/W higher customer value compared to TOPCon 1.0, with LCOE reductions of up to 3.35%.

Zhang Yingbin told CLS reporters that top-tier enterprises should take the lead in improving asset utilization across the industry, elevating existing capacity to a new level. This involves further reducing LCOE and setting an example for other enterprises, thereby influencing the industry's structure. Additionally, exploring potential differentiated product solutions in niche markets is also important.

Jinko Solar told CLS reporters that the company updates its TOPCon series annually, with module efficiency improving by an average of 1% per year and power increasing by 30W per year. The third-generation Tiger Neo is expected to enter mass production in 2025.

Single-GW Cell Upgrade Costs Around 30 Million Yuan

From the perspective of conversion efficiency, BC cells have an advantage due to their structural characteristics. Industry experts believe that the mass production efficiency of BC cell technology is expected to reach 27.5% or even exceed 28%, making it the closest technology to the theoretical efficiency limit of crystalline silicon cells at 29.56%.

Currently, BC cells involve more production steps and relatively complex processes, requiring higher equipment investment and stricter production control. This results in higher production costs compared to TOPCon cells, which is a key reason for the slower promotion of BC cells in this round of technological iteration.

In terms of conversion efficiency, the mass production level of TOPCon cells continues to improve. Industry analysis suggests that top-tier enterprises using TOPCon technology are expected to achieve cell efficiencies exceeding 26% and open-circuit voltage levels above 740mV, signaling that the entire industry is entering the TOPCon 2.0 era of competition.

Regarding upgrade costs, Zhang Yingbin stated that the current cost of upgrading TOPCon cells is approximately 30-40 million yuan per GW, with a 10GW upgrade requiring an investment of 3-4 billion yuan. For BC cells, the investment cost per GW is 250-300 million yuan, exceeding 300 million yuan if electroplated copper technology is used. Under these circumstances, the cost of upgrading 10GW of BC cells could upgrade nearly 100GW of existing TOPCon cell capacity, achieving more extensive capacity upgrades at minimal cost. According to Trinasolar's plan, the company's first batch of upgraded 10GW TOPCon capacity is expected to achieve mass production in Q2 next year, with a ramp-up period of 2-3 months. The pilot line has been completed, but industrialisation on a larger scale will require a phased approach of 5GW+5GW.

According to Zhang Yingbin's preliminary estimates, the cost per watt for TOPCon upgrades is expected to increase by a few tenths of a yuan to less than one cent, while the added value is estimated at 4-5 cents domestically and up to 0.1 yuan overseas. Initially, the supply of TOPCon 2.0 products will be relatively limited, requiring a certain premium to incentivize manufacturing and promote healthy industry development.

Previously, compared to TOPCon technology, BC's advantages lay in better temperature coefficients and annual degradation rates. Therefore, in high-irradiance and high-BOS scenarios, such as in Spain, BC had a comprehensive advantage, particularly when its power exceeded TOPCon by 20-30W.

However, Zhang Yingbin noted that as the power gap between TOPCon and BC narrows to a maximum of 10W or even reaches parity, BC's advantages in such scenarios are gradually diminishing. Meanwhile, TOPCon's bifacial rate is 15% higher than BC's. Although BC products may narrow this gap in the future, at least a 10% difference will remain in the short term. The rear-side power generation will continue to deliver benefits over the 20-30 year life cycle.

Chen Yifeng believes that TOPCon has achieved rapid improvements in the past, with an annual increase of approximately 0.5%. However, there is still significant potential for efficiency gains, as TOPCon's theoretical limit is higher than that of heterojunction cells, reaching 28.7%. Currently, the efficiency level is only at 26%, leaving a 2% gap, indicating that substantial efficiency improvements are still ahead for TOPCon.

Chen Yifeng also believes that in the future, TOPCon can be combined with perovskite tandem structures to achieve tandem cells with efficiencies exceeding 30%, further consolidating its capacity and product leadership.