Few outside the solar industry may have heard of China’s Longi Green Energy Technology, but it is possibly the most transformative manufacturer of solar technology in the world. And that’s just the start of the story of China’s success in this important area of renewable energy today.

Already the biggest solar producer globally, with plants in China, Vietnam, Malaysia and, coming soon, India and the US, Longi sees itself as being in the vanguard of the technology for years to come.

In August 2023, for example, it started delivering the energy for China’s largest pilot green hydrogen project by deploying a combination of solar and electrolyser technologies. Nothing if not ambitious, Longi President Li Zhenguo predicted earlier this year that, if his and other Chinese solar producers continue to expand at the current rate, the domestic industry’s total production capacity could hit 1,000 GW by the end of 2024.

Capacity of that size justifies pause for reflection. As the Oxford Institute for Energy Studies (OIES) explains: ‘A capacity of 1,000 GW would more than double global solar demand in 2022 and would be capable of supplying almost all of China’s goal of 1,200 GW of combined solar and wind installations by 2030.’

But even if China’s solar industry doesn’t reach that volume of production, its growth is already off the scale. As Rystad Energy consultants explained in September 2023: ‘China’s solar sector is set to break records in the coming years,’ citing exponential growth. By the end of 2023, for example, total installed solar PV capacity should exceed 500 GW. Impressive enough, but by 2026 that is expected to double again to 1,000 GW (1 TW), according to Rystad’s models.

Further proof of China’s eminence in solar? New capacity added in 2023 should exceed 150 GW, nearly double that of 2022, which itself was a good year.

For comparison, China’s current 500 GW of capacity represents roughly 40% of all global capacity. It is a measure of China’s advantage over the rest of the world that the current runner-up is the US, with just 145 GW. As Rystad Energy points out, even with the generous incentives available under the Biden Administration’s Inflation Reduction Act (IRA), total US capacity by 2026 is heading for just over 200 GW, or a fifth of China’s.

To put it another way, the OIES notes that in the first nine months of 2023 China added more PV energy than the entirety of the US’ current capacity.

Warm-up
Hungry for further expansion, China’s solar giants are heading offshore and may at current rates of activity end up adding much or even most of the solar energy in the US and European Union (EU), both of which are pledged to a net zero future.

In mid-2023, Chinese-based Trina Solar, which has been in the business for more than a quarter century, signed with Aquila Energy to supply 800 MW of solar modules for a variety of projects in Southern Europe due for delivery through 2024. Ominously for European competitors, the Chinese company sees this contract as a warm-up before moving into other countries.

China’s solar manufacturers are already off to a flying start outside their own shores. They have been selling into Europe for years, as distinct from actually manufacturing there, and have long-established sales offices there that have netted important contracts.

The biggest opportunities may lie in the US. Longi, for example, is building a plant in Ohio while compatriot JA Solar is following suit in Arizona where these companies expect to be able to profit from domestic manufacturing subsidies. Although some observers are uncertain whether they will be welcome in these jurisdictions because of current political tensions with Beijing, if they comply with local regulations, it’s hard to see how Brussels and Washington can stop them, especially if they use local labour and materials.

Trina Solar, however, isn’t waiting to find out. It has already completed large-scale industrial contracts in the US, most recently for a steel manufacturer in Louisiana. Capitalising on a range of tax credits, the manufacturer was able to save half of the costs of installing Trina Solar’s roof-mounted PV panels that, according to independent assessments, will save the manufacturer $2.27mn/y in its electricity bills and achieve payback inside three years.

That’s a compelling argument that other potential US clients will surely notice.

Further cementing its place in the US, Trina Solar has promised to use only American and European polysilicon in a plant it is building in Texas, thereby complying fully with the IRA. Right now the momentum of Chinese manufacturers like Trina Solar seems unstoppable.

The OIES notes that in the first nine months of 2023 China added more photovoltaic energy than the entirety of the US’ current capacity.  

Race for conversion
How did China get so far ahead in solar?

First, the solar industry started early – Trina Solar opened its first plant in 1997 – and it employs top scientists. In the race for solar PV cell efficiency – the ability to convert the sun into the maximum amount of energy – Longi claims to have broken the world record no less than 14 times in the last two and half years. And it’s not stopping there. In mid-2023 Longi announced a conversion efficiency of 33.5% for tandem solar cells based on silicon and ‘wonder material’ perovskite, in yet another independently assessed record.

Most critically, the Chinese industry prides itself on the rapid conversion of breakthroughs in the lab into a commercial-scale fast-moving assembly line. ‘No lead, no production expansion’ is the Longi motto. The general timetable is to turn its research into mass production within two or three years. Companies like Longi are mass-producing the latest thin-film PV, also called third-generation PV.

According to a September 2023 article in US magazine Perovskite-info: ‘Perovskites are a class of materials that share a similar structure which display a myriad of exciting properties like superconductivity, magneto-resistance and more. Easily synthesised, these materials are considered the future of solar cells as their distinctive structure makes them perfect for enabling low-cost, efficient photovoltaics.’ In fact, we can expect to see perovskites turning up in the next generation of electric vehicles (EVs), sensors and lasers.

Unlike some of the earlier technologies, perovskite solar cells are relatively easy to manufacture despite some problems, for instance with toxicity, and China maybe has a jump on the field. In late November 2023, for example, China-based BOE Technology joined the race with its entry into the PV field through perovskite-based cells.

China energy-watchers also attribute the unprecedented growth of the solar industry over the last three years to a speech that President Xi Jinping made in late-2020 when he introduced the notion of ‘shuangtan’, a word meaning ‘dual carbon’. Surprising just about everybody, including Chinese energy analysts, shuangtan promises a peak by 2030 for CO₂ emissions and carbon neutrality before 2060. Scrambling to put numbers on this pledge, Beijing’s policy makers in the National Development and Reform Commission came up six months later with ‘1+N’, which encompasses the carbon and neutrality elements of shuangtan.

There was considerable scepticism at the time. A senior adviser to John Kerry, the previous US government’s Special Envoy for Climate, characterised the challenges posed by shuangtan as ‘the most Herculean thing accomplished in human history’. However, the progress has been impressive.

One of the most successful pathways to shuangtan is known formally as the ‘Whole County Photovoltaic Programme’ and applies to numerous regions. Under the programme, much of the breakneck addition of solar energy is happening on residential rooftops because it’s often easier to distribute the energy through houses, rather than through utility-scale installations that may be far from the cities of peak demand.

The International Energy Agency (IEA) sees a huge future for so-called distributed solar on rooftops as distinct from utility-scale plants. Estimating that China will need around 4,000 GW of solar capacity by 2060 to meet its climate goals, the IEA believes more than half will come from rooftop-mounted systems.

Along the way, Beijing’s energy planners have introduced a more enlightened system of measuring the growth of renewables. Instead of rating growth by the volumes being deployed, or even by the energy being generated, the new system measures it by consumption. As the OIES points out: ‘This means provinces should not build projects that will be difficult to integrate into the grid or that will be far from demand centres. But should instead prioritise policies to guarantee effective consumption of renewable buildouts.’

In short, what matters is how much of the available energy is actually used rather than just provided.

Energy security
Despite shuangtan-catalysed progress, old King Coal has reared its ugly head. After all, solar power is limited to when the sun shines and never at night, in concert with battery storage in some locations. When drought-triggered power shortages hit the cities in 2021 and 2022, Beijing came under pressure to keep the lights on by whatever means.

All of a sudden President Xi began making speeches about ‘energy security’ and not abandoning old forms of energy in the race for the new. With Beijing’s seal of approval regional governments boosted subsidies for coal mines that took the form of production incentives.

However, most analysts see these subsidies as an interim policy that will be superseded by the boom in renewables, with solar in the forefront. There is also increasing pressure for solar cell and module manufacture to be brought closer to home in Europe and the US for energy security and economic support, with significant initiatives underway. But is to too late to gain significant market share from the Chinese solar pantechnicon?

To find out more about China’s energy transition, visit the Energy Institute Statistical Review Country Transition Tracker.