The global solar industry has experienced tremendous growth in the past decade as the annual demand for solar rose year after year while the cost of solar declined significantly, driven by much cheaper solar modules. Can those price declines continue into the 2020s? New research from Wood Mackenzie says yes, but just at a much slower rate.
The latest Solar PV Module Technology Market Report 2020 indicates that improvement in module efficiency and power class will propel the declining capex trend forward and ultimately lower the solar levelised cost of energy (LCOE). The research suggests that the 2020s will be a decade with rapid solar module technology innovations, leading to significant increases in module power class, better performance, more versatile applications.
Large wafer impact
Wood Mackenzie examined three technologies that have the potential to improve solar module power class and performance: large wafer, n-type cells, and cell- and module-level techniques.
“We found that PV modules made of large wafers, such as the M6, M10, or G12 format, could reduce the capex of a utility-scale solar project by 3% to 9%,” noted report author Dr Xiaojing Sun. “The cost savings would be appealing to solar developers and installers, which will drive the market adoption.”
She said a majority of the major silicon module manufacturers have announced large module products, and many of them are on track to commercially produce large modules between Q4 2020 and Q4 2021. Wood Mackenzie’s data show that the total module manufacturing capacity of M6, M10, and G12 wafer-based modules will reach 28 GW, 63 GW, and 59 GW, respectively, by the end of 2021. By 2025, the production capacity of modules using M10 and G12 wafers is forecasted to exceed 90 GW, respectively, making them the dominant technologies by manufacturing capacity.
But these changes can’t happen in a vacuum.
“It is important to point out that the market adoption of large modules is dependent on the co-evolution of balance-of-system components such as inverters and trackers to accommodate the higher current and the larger size,” Sun said. “Multiple industry alliances have been formed since early 2020 to ensure the entire solar ecosystem evolves to support the adoption of large modules.”
If the industry’s efforts bear fruit, Wood Mackenzie forecasts that large module shipments in 2021 will account for approximately 40% of the total shipment of crystalline silicon modules. By the end of 2025, modules made with wafer sizes smaller than M6 will phase out of the market.
The future of n-type
The report also investigated n-type modules, such as HIT and TOPCon, that could generate more power per panel due to higher cell efficiencies and have lower degradation rates. Unlike large modules, n-type modules do not currently yield system capex and LCOE savings in utility-scale solar projects. N-type modules’ high product costs offset the system-level non-module cost savings.
“Our analysis shows that TOPCon and HIT modules will need a power class premium of at least 40 W and 90 W, respectively, or a 6% and 20% price cut in order to be competitive with mono PERC,'” Sun said. “Admittedly, these are tall orders. Nevertheless, significant efficiency improvement and production cost reduction are n-type modules’ must-take path to succeed mono PERC as the next generation solar module of choice.”
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