On November 20, the 7th China International Photovoltaic and Energy Storage Industry Conference 2024, which lasted for four days, officially came to an end.

According to the project signing data disclosed by Tongwei Group, the organizer of the conference, during the conference, more than 60 cooperation projects in Chengdu, Leshan, Meishan, Yibin, Guangyuan, CGN New Energy, Tongwei Co., Ltd., GCL, and Chu Yuan Century have been signed and landed, with a total amount of more than 30 billion yuan, and the project investment involves the entire optical storage industry chain such as high-efficiency cells and modules, distributed photovoltaic projects, smart energy, energy storage, and equipment manufacturing.

Judging from the disclosed statistics alone, the cumulative total contract amount of 30 billion yuan has made some industry insiders define this Western Optical Storage Conference as a "feast" for optical storage.

However, after the first financial reporter visited the exhibition, it was found that most of the companies that came to the exhibition were suppliers and equipment and materials suppliers of the organizers, and from the perspective of popularity, most of the business personnel of a single booth were 1~2, which has been greatly reduced compared with the industry boom. After talking, the reporter found that the industry has developed rapidly so far, and most of the companies are not expected to sign large orders at the exhibition, and most of them are there to "show up to support" mentality.

Industry leaders collectively "reflect".

The photovoltaic "veterans" who are in the game and have experienced the "blood loss" of the performance in the first three quarters have realized the severity of this round of industry cycle, and the "reflection" is not profound.

In 2024, China's PV is experiencing the most severe challenge in history. "The breadth of coverage, the magnitude of adjustments, and the depth of impact of this cycle are unprecedented. To solve this round of dilemma, there is no historical experience to learn from, and we are crossing no man's land. "Trina Solar (688599. SH) Chairman Gao Jifan said during the conference.

Industry problems go hand in hand with rapid development. "There are external reasons for today's predicament, and there are even more internal causes." Gao Jifan believes that China's photovoltaic industry has reached a global leader in technology, production capacity and market, and should have created an industry ecology of high-quality development, but some companies still follow the traditional business thinking of simple low-price competition and technology copying and imitation, and lack of awe of fair competition, lack of respect for innovation, and lack of awareness of high-quality development, which have finally become the driving force of the industry's involution.

Wang Lubao, chairman of Jiangsu Meike Solar Technology Co., Ltd. (hereinafter referred to as "Meike Co., Ltd."), a wafer company that recently announced the suspension of its IPO, said during the conference that the industry is probably losing money from polysilicon to the entire industrial chain, including all consumables. "We must think soberly that the photovoltaic industry cannot take its own life away like it is now."

He also appealed at the conference: "This year's Spring Festival holiday is a month, and the existing inventory will be turned into zero inventory." Let's take a good rest and rest in the PV industry. ”

During the small-scale exchange of the conference, Tongwei Group (600438. Liu Hanyuan, chairman of the board of directors of SH, used the "breakfast theory" to explain his attitude towards the current industry involution and irrational competition. "PV involution is a derogatory term, but the appropriate 'volume', necessary 'volume', is the source of vitality and motivation of the industry, and can promote the progress of the industry. We must clarify the positive and negative aspects of competition, guide the industry to compete moderately, and avoid vicious competition. Liu Hanyuan said in an interview with CBN and other media that the greatness of the market lies in the continuous formation of pressure, forcing people to be unable to sleep lazily and "lie flat". "You can sleep and 'lie flat', but tomorrow and the day after tomorrow's breakfast will naturally not be yours."

Bidding and sales below cost price violate the provisions of the "Bidding Law" and are an important driving force for the industry. Talking about the recent supply-side reform call for "breaking the book" in the industry, Liu Hanyuan said that as a tool for adjustment, production and price limits need to be used conditionally. "Under the constraints of Europe and the United States, OPEC can coordinate crude oil output and stabilize crude oil prices, so China's photovoltaic must also be able to."

Wang Bohua, honorary chairman of the China Photovoltaic Industry Association, used "far exceeding" to describe the degree of adjustment of the current round of photovoltaic industry.

"The scale of losses caused by industry fluctuations is far greater than the previous three industry fluctuations." According to the data given by Wang Bohua on the spot, among the 121 listed photovoltaic companies, 39 have a net profit loss this year; This year, the prices of all links in the photovoltaic industry will drop by 60%~80% compared with the high point in 2023, and most links will operate at a loss in the second half of this year; In the first three quarters of 2024, the output value of the manufacturing end fell by more than 44.7% year-on-year.

What to do in the future

Although it has been in the "cold winter" for a long time, it is undeniable that the industry is releasing positive signals for the better.

In the past month, the China Photovoltaic Industry Association has actively organized an "anti-involution" symposium, set a "floor price" of 0.68 yuan/watt to win the bid, and the market has repeatedly rumored that enterprises in all links are willing to "sit down and talk" on production and price limits...... There are endless calls for self-regulation and rational competition in the PV industry.

"On the basis of the positive progress made in the early stage of self-discipline, it is recommended to continue to increase the intensity of industry self-discipline, expand the coverage of self-discipline, so that more enterprises in the upstream and downstream of the industrial chain can join the industry self-discipline." Gao Jifan suggested at the conference site that we should strictly implement the self-discipline commitment of sales not lower than the cost price, and actively explore an effective mechanism to control the operating rate of the industry at a reasonable level through self-discipline.

Gao Jifan also suggested that the competent government departments should carry out special governance, and deal with illegal bidding behaviors below the cost price through administrative law enforcement, central enterprise management and other methods in accordance with laws and regulations, so as to form a long-term mechanism and effectively eradicate the stubborn diseases of the industry.

"Involution is not the way out, innovation is the way out. Li Junfeng, executive director of the China Energy Research Society, put forward five suggestions at the conference: "adhere to technological innovation and oppose involution competition", "adhere to co-creation and win-win, and build a benign industry ecology", "adhere to joint cooperation, and actively respond to global challenges", "accelerate the integrated development of photovoltaic and storage, build a new energy system", "grasp the general trend of the times, and strengthen development confidence".

Li Junfeng emphasized that the price must reflect the value. "When the cost of photovoltaic power generation is already lower than that of fossil energy, there is no need to blindly pursue cost reduction, especially not blindly ask for a price reduction. ”

"It is recommended that you must not sell below the cost price, and you must enhance the real competitiveness of the enterprise through technical means." Liansheng Technology(300051. SZ) chairman Wang Xin said that the problem now is not a problem of cost competition. Enterprises should reduce costs and increase efficiency through technology, reduce costs and achieve real and real low power costs, so as to win the development of the entire photovoltaic industry system.

In the course of the interview and exchange, the photovoltaic entrepreneurs made their own predictions on the market inflection point and the performance of the market outlook. Some are optimistic, such as Wang Lubao expects that the industry will usher in an adjustment period in the second quarter of next year, and some companies bluntly say that a considerable number of photovoltaic companies will "not be able to get out" of this cycle.

"At present, the photovoltaic industry is indeed in a low stage, but from the perspective of the general direction of the industry, there is a high probability that it will pick up next year." He Tanggui, executive deputy general manager of Meishan Liansheng Photovoltaic Technology Co., Ltd., said in an interview with the media that from a long-term perspective, the photovoltaic industry is still a fast-growing incremental market. By 2050, nearly 40% of China's electricity generation will come from photovoltaics, which still account for a small proportion of China's current energy mix. On the other hand, the rise of artificial intelligence will bring huge demand for electricity. He said: "In particular, the requirements for power consumption of algorithms and computing power are very huge, and now PV is still in the 'teenage stage'. ”

JA Solar (002459. Li Dong, vice president of SZ, said that it is difficult to solve the current capacity problem through market growth, so this round of industry cycle may be longer, rather than saying that all companies come out at the same time. "Some companies may be one or two years old, some companies may be two or three years, and some companies may not be able to find them after two or three years."

Wang Yicheng, general manager of Meike Co., Ltd., also said in an interview with the first financial and other media that this round of adjustment is mainly caused by overcapacity, which leads to imbalance between supply and demand and price fluctuations, and exacerbates the "involution" of the industry.

"This industry has only just begun, and now it is only in the teenage years at most, and if there is a problem, it is also the troubles of the young Werther." Liu Hanyuan recently publicly said at the CCTV dialogue site, "There are ups and downs in the market in any industry, and excess under market conditions is the norm, and shortages are the norm." In this process, there are highs and lows, and we think it is normal. After a certain period of time, the waves have swept away and a new balance has been re-established, and we are in fact still full of confidence in the future. ”

(This article is from Yicai).

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