Solar Power » Industry

Value Chain Activity: Manufacturing Crystalline Cells


Context

Cell manufacturing involves creating the all-important pn-junction, coating and layering。 It is an important step in the value chain that is responsible for 14% of a module's cost and it is here where significant technical differentiation is created。

Industry Dynamics

High capital requirements


High capital requirements for the manufacturing line combined with need for economies of scale mean can make it difficult for new entrants。

 

Upstream supply secured wtih long-term contracts

Suppliers of wafers are either independent wafer companies or polysilicon producers themselves. In any case, the supply is dominated by the relationship with polysilicon suppliers. See separate section on dynamics.

 

Conclusion

The trend towards vertical integration is very evident in this segment。 Of the 62 companies surveyed, only 19 were pure and simple cell manufacturers。 Many were both forward- and backward- integrated into wafers and modules。 Some of the largest cell manufacturers that are integrated into modules do not sell their cells separately, for instance SolarWorld or Suntech Power, thus limiting the choice for module makers that are not backward integrated into cell manufacturing。

Competition based on differentiation and price

Competition
There is an ever-growing number of cell manufacturers, and the industry is not dominated by a few big players in the same way as is true for the polysilicon industry. The top 10 producers in 2008 produced just over 50% of the total. The market leader, Q-Cells, commands a market share of 10%.

Balance Sheet Strength
Spurred on by growing demand, there has been an aggressive expansion of capacity in the past years, most notably in China and Taiwan. Of the 62 companies surveyed by Green Rhino Energy, 26 were based in China and 10 in Taiwan. While the average leverage (long-term debt-to-equity) for the listed companies in this survey was 44%, there are stark differences in balance sheet strenghts. At the weak end of the spectrum, Isofoton operates at 120% leverage and current ratio of 80%, which looks very vulnerable. In contrast, Q-Cells has a 35% leverage and current ratio of 1.93.

Product Differentiation and Margins
The industry is divided into a technically differentiated, high-efficiency cell segment and a bulk cell production segment with average efficiencies. This is reflected by margins. Median gross margin has fallen from 16.8% in 2007 to 11.5% in June 2009. However, the top cell manufacturers Q-Cells, Trina Solar, Kyocera, Sharp and Yingly enjoy much bigger margins.

Technology Strategy
While some cell manufacturers, most notably Sharp and Q-Cells, also take stakes in thin-film technologies, others choose to stick to crystalline silicon technology. CentroSolar, for instance, has neither a technically differentiated crystalline-based silicon product, nor does it offer other technologies.
PV Cell
 

Partner with main alternative product

The main alternative to crystalline cells is thin-film. However, switching costs for manufacturers would be high. Instead, to mitigate the risk, cell manufacturers partner with thin-film producers. Q-Cells, for instance, acquired 93% stake in thin-film developer Calyxo.

 

Downstream: Fragmented industry of module manufacturers

While some cell manufacturers are forward-integrated into modules, there are many more module- than cell- manufacturers, many of whom have no global presence.


Market Share in Cell Production 2008
Cell Cost Trends

Crystalline Cell Cost Trends

Variable costs (e.g. wafers) dominate costs with 75%. Low-cost wafer contracts are all-important to a low-cost model. Average margins have come down from 22% to 12%.

Company Details

We have surveyed 62 cell makers world-wide. With aggressive growth in Asia, we are expecting the top-10 list to change from year to year. However, the structure will probably remain such that there is no one company or five companies that dominate the market.

While companies of all sizes are present in the industry, only mid- to large- cap companies have a significant market share and profitability.

Name Vertically integrated? Country Comments

Sales € mill

Gross profit margin Debt / Equity
Top-10 Companies
Yes, into wafers and thin-film Germany

Biggest cell manufacturer。 Monocrystalline cells to 16。8%, multicrystalline cells to 15。2%。 For thin-film technologies see Calyxo, Solibro and Sontor

Q-Cells has filed for insolvency inApril 2011.

1,290 31.91% 0.35
Yes, into modules Japan Crystalline and thin-film (a-Si). Monocrystalline cells 17.5% (modules 14.2%), multicrystalline cells 14.4% (modules 13.7%) 21,447 15.71% 0.78
No China With in-house "Pluto Technology" achieve 18% mono-crystalline cell efficiency. Plan to extend to thin-film. 1,389 17.71% 1.51
Yes, into modules Japan Pioneer in solar technology. Its new d.blue range of modules use special plasma coating to reduce reflection off the glass. Multicrystalline cell efficiency 16.5% 8,501 25.87% 0.04
No Taiwan Claim to be most efficient c-Si 16.6%. Offer both mono- and multicrystalline cells. 300MW capacity. 346 15.80% 1.36
Yes, into wafers and modules Taiwan One of the largest PV cell manufacturers. Monocrystalline efficiency to 18.24%, multicrystalline to 16.5% 499 14.69% 0.41
Yes, into modules Germany Production capacity 2008: 260MW, Plan for 2010: 700MW. Module efficiency 16% (multi) and 17% (mono). Won the "Highest yield module" Photon award 2008 937 50.06% 0.83
Yes, into wafers and modules Germany HIT Technology: Thin c-Si with ultra-thin a-Si: Cell efficiency 19%, module efficiency 16.6% 571   0.00
Yes, into wafers and modules China 200MW for cells, 200MW modules. Plan to increase capacity to 600MW in 2009 797 21.58% 0.83
No China Monocrystalline cells from 15.5% - 18%; multicrystalline from 14% - 16.5% 576 18.17% 0.43
Other Companies
Yes, (soon) into polysilicon Canada Producer of cells. Plan to produce solar-grade si (7N plus) using patented process by 2009. 20MW 2009, 90MW 2010 22 -44.19% 0.59
Yes, into modules China      
Yes, into wafers and modules China      
No Taiwan 90MW capacity      
Yes, into wafers and modules China completed two solar demonstration projects with a combined system size of 29.5 kWp for China’s Suzhou Municipal City Hall 509 10.07% 0.47
Yes, into wholesale distribution. No technologically differentiated module Germany Multi-crystalline cells with efficiency of more than 16%. But not integrated into modules. 338 17.41%  
Yes, into modules China Capacity 50MW      
No China Capacity 320MW. Mono- and multicrystalline cells 16% - 16.8% 253 4.41% 0.96
Yes, into wafers and modules China      
Yes, into wafers and modules Germany      
No Taiwan c-Si advanced cells: monocrystalline 17.3%, multicrystalline 16.2%      
Yes, into modules China 50MW cells, 200MW modules      
Yes, cover the whole value chain from polysilicon to modules Germany Specialises in re-cycling of silicon. Wafers are made from polysilicon. Thin-film tech is a-Si. Monocrystalline cells to 17.5%, multicrystalline cells to 16% 175   0.56
No Taiwan 440MW capacity. Soon also in thin-film. Have mono-Si cells 16.4% - 18% and poly-Si cells 15.2% - 16.8% 363 14.25% 1.87
No Taiwan 190MW capacity      
Yes, from wafers to modules USA Utilse the Ribbon technology for silicon wafers. 80 16.87% 0.72
Yes, into modules China crystalline Silicon cells / modules      
Not in solar value chain. But part of large chemicals business. South Korea Large chemical corporation. New focus on renewables: Hydrogen storage and solar cells with capacity 30MW (2008). Plan to have 1GW eventually. Also plan to integrate into polysilicon and modules. 3,050 15.64% 1.35
Yes, wafers to modules China 200MW by 2009 capacity      
No India c-Si capacity 360MW by 2010      
Yes, into modules and further downstream Spain Produces mono-crystalline cells (to 17.2%) and modules to 13.8%. Now developing a high-concentration pv module (1000x). Also manufactures solar thermal collectors.  259   1.20
Yes, from wafers to modules China 181 16.26% 0.42
Yes, into modules China      
Yes, into modules China      
No China Capacity 200MW in 2009      
Yes, from wafers to modules China      
No India Newcomer: Planning capacity      
Yes, into modules South Korea 100MW capacity      
Yes, from wafers to modules China Module capacity 80MW      
No UAE Largest cell manufacturer in the Middle East - 100 MW by 2010      
Yes, into modules and electrical components Japan High efficiency crystalline Si 18.6%
Plan to increase capacity to 500MW by 2012
27,608 26.03% 0.80
Yes, into modules India Current capacity ~ 200MW. Monocrystalline cells 16.8% (module 12%). Have a-Si technology 26    
No Taiwan Monocrystalline cell efficiency to 17.6%. 222 8.03% 0.74
Yes, into modules China      
Yes, into modules Germany Monocrystalline modules to 18% from own cell production line, but cells are not sold separately.      
Yes, into modules France Produce some of the thinnest cells on the market, both mono- and multicrystalline to 17% 140   0.94
Yes, from polysilicon to modules Norway 2008: Capacity: 225MW for cells, 150MW for modules. Plan: 780MW for cells, 740MW for modules. Silicon produciton in USA 909 79.23% 0.40
Yes, from wafers to modules China      
Yes, into wafers China Solar ingots and wafers. Also produce chip-grade material      
Yes, into modules China crystalline Silicon cells / modules      
No South Korea Newcomer. Want to add 50MW annually      
Yes, from polysilicon to modules Spain With Siliken Chemicals, Electronics and Modules produce poly-Si, modules, inverters. Module production 92MW      
Yes, from wafers to modules Greece Capacity 60MW total      
Yes, into modules Germany  217 11.10% 0.30
Yes, into modules China Produce cells with 17.2% (mono) and 16.2 (multi) efficiencies 522 -0.45% 1.19
No Taiwan 105 12.48% 1.86
No The Netherlands Produces high-efficiecy multicrystalline cells (16.4%). Have achieved world record (in 2009) full-module efficiency of 16.4% with Solland cells (in a lab).      
No South Korea Newcomer in Aug 2008      
Yes, into modules USA Its monocrystalline Solar Panel "315" acheives cell efficiency 22% and a module efficiency of 19.3%!  1,036 25.34% 0.51
No Taiwan      
Yes, into modules Germany Produces mono- and multicrystalline cells to 17.3%, as well as transparent, coloured crystallines cells (13.9%).  264 12.33% 0.49
No Taiwan Multi-crystalline solar cells. Plan to reach 1GW capacity by 2014      
Yes, from wafers to modules China Capacity of 350MW each in wafers and cells. Rapidly expanding globally. Monocrystalline cell 17%, module 16% efficiency.  601 19.77% 0.92
Yes, from wafers to modules China      

 

Downloads: Download comprehensive list of ingot & wafer producers including financial ratios, revenues and other information.

ReferencesAll company information has been obtained from company websites, Reuters and Factiva database. For comparison, currency amounts have been converted using exchange rates as of 20/06/09.

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