The growth rate of new installations is expected to slow down this year. Systematic operational risks for PV companies still exist, but industry chain prices have already rebounded.

"Competing both domestically and internationally, working hard but not making money." This was how a guest summarized the current state of the PV industry at the "2024 PV Industry Development Review and 2025 Outlook Seminar" held today.

Manufacturing side, last year, domestic production of polysilicon, silicon wafers, solar cells, and modules all grew by over 10% YoY. Export volumes of solar cells and modules increased by 46.3% and 12.8% YoY, respectively, continuing the growth trend in PV manufacturing production.

However, export value, product prices, and output value all declined to varying degrees. According to statistics from the China Photovoltaic Industry Association, last year, the total export value of PV products was approximately $32.02 billion, down 33.9% YoY. Prices across the four major segments dropped by over 39%, 50%, 30%, and 29%, respectively. The domestic PV manufacturing output value (excluding inverters) remained at the trillion-yuan level but declined YoY. Additionally, silicon wafer export volumes fell by 13.3% YoY.

"In the past, summaries of the PV industry were always very optimistic and full of momentum, but this year is different," said Bohua Wang, Honorary Chairman of the China Photovoltaic Industry Association, at the seminar. He projected that global PV installations in 2025 will continue to grow, but the growth rate will slow. Optimistically, global new PV installations in 2025 are expected to grow by 10% YoY.

It is worth noting that systemic risks in business operations are increasing. Due to the rapid decline in product prices, the profit margins of PV companies have been severely compressed, with some small and medium-sized enterprises declaring bankruptcy. According to incomplete statistics, as of now, 33 PV publicly listed firms have issued performance forecasts, most of which indicate reduced revenue, a shift from profit to loss, and underperformance leading to project suspensions and equity changes.

According to Bohua Wang, among these 33 companies, the total amount of disclosed performance reductions and losses is approximately 40 billion yuan, roughly 10 times the total amount of performance increases, indicating that industry losses are expanding.

Starting from Q1 2024, net profit in the module segment turned negative for the first time, and the auxiliary material segment faced pressure. By Q3 2024, net profit in the auxiliary material segment also turned negative, exacerbating the industry's cash flow crisis. In the main industry chain segments, revenue and profit plummeted, debt ratios remained high, and accounts receivable turnover days doubled. Net profits of production equipment companies also declined significantly.

A reporter from Caixin noted that under multiple systemic risks, the PV industry initiated a self-regulated production cut plan in December last year, which has gradually shown results. According to Bohua Wang, polysilicon, silicon wafers, and solar cells saw rapid declines in H1 2024, stabilizing overall in H2. Prices of silicon wafers and solar cells have shown some rebound this year.

Bohua Wang stated that as one of the key industries, the PV sector needs to address structural imbalances by acting on both supply and demand sides.

On the supply side, the "PV Manufacturing Industry Standard Conditions" policy introduced new requirements, raising the capital ratio and technical benchmarks for new projects, thereby upgrading the entry threshold for PV manufacturing. For example, in the solar cell segment, new P-type cells and modules must achieve efficiencies of no less than 23.7% and 21.8%, respectively, while new N-type cells and modules must achieve efficiencies of no less than 26% and 23.1%. The policy aims to guide PV companies to reduce purely capacity-expanding projects, strengthen technological innovation, and improve product quality.

On the demand side, electricity trading has become a critical factor influencing PV development. On February 9 this year, the National Development and Reform Commission (NDRC) and the National Energy Administration jointly issued the "Notice on Deepening the Market-Oriented Reform of New Energy On-Grid Tariffs to Promote High-Quality Development of New Energy," marking the end of the "fixed electricity price" era for new energy and the full transition to a market-based electricity price development cycle.