Industry events:
On May 18, 2022 local time in Brussels, the EU issued the “REpower EU” plan, which aims to get rid of dependence on Russian energy and realize the rapid transformation to green energy by 2030. It is mentioned in the plan that the EU will take a number of measures to increase the proportion of new energy from 40% to 45% in 2030. In 2025, the EU will double the installed capacity of photovoltaic, and the newly added installed capacity of photovoltaic will reach 600gw by 2030.
“Repowereu” will further promote the rapid growth of photovoltaic installed capacity in Europe
Affected by the recent conflict between Russia and Ukraine and inflation, the prices of bulk commodities and energy in Europe have risen sharply. The price of power coal in ara port rose from US $150 / ton at the beginning of the year to US $323 / ton in May, an increase of 115.33%. Many European countries rely on Russia to import coal, oil and natural gas, and the EU’s energy security is directly threatened. In order to seek energy independence, the EU issued the “REpower EU” plan, which plans to invest a total of 210 billion euros by 2027. It is planned that the installed capacity of PV will reach 320 and 600gw in 2025 and 2030, while the cumulative installed capacity of EU will be 178.7gw by the end of 2021, which means that the average annual installed capacity of EU PV will exceed 46.8gw by 20222030. Repowereu also shortened the review cycle of roof photovoltaic to within three months, and took legal measures to gradually require new buildings to install roof photovoltaic.
Germany, a major European Photovoltaic producer, has responded in advance
In 2021, the EU’s newly added photovoltaic installed capacity was about 25.9gw, with a year-on-year increase of 34%, and the cumulative installed capacity reached 178.7gw, of which Germany, Spain and the Netherlands ranked in the top three with the scale of 5.3, 3.8 and 3.2gw respectively. Germany has taken the lead in policy-making. On February 28, it proposed a new draft legislation to advance the target of 100% renewable energy power generation from 2050 to 2035. In order to achieve the target, the new installed capacity of photovoltaic is proposed to gradually increase from 7gw in 2022 to 20GW in 2028, and then maintain this level until 2035.
European module demand will become the growth engine of China’s photovoltaic industry chain
Limited land resources, long-term dependence on imports for the construction of photovoltaic power stations and insufficient cost competitiveness in Europe. We predict that the long-term dependence on imports in Europe will continue, and higher module premium will be tolerated. China is the world’s largest producer of photovoltaic modules. In 2021, China’s component export volume reached 98.5gw, and the overseas market accounted for 76.9%. According to the statistics of PV InfoLink, from January to March 2022, China exported 9.6, 14.0 and 13.6gw of photovoltaic modules, totaling 37.2gw, with a year-on-year increase of 112%, of which 16.7gw were exported to Europe, with a year-on-year increase of 145% compared with 6.8gw in the same period last year. It is the region with the strongest demand and the fastest growth rate.
Investment advice
In the case of energy security crisis, EU module imports will receive higher premium. This year, China’s photovoltaic module exports will increase and obtain greater benefits under the depreciation of RMB exchange rate. It is suggested to pay attention to the battery module export enterprises in the photovoltaic industry chain Longi Green Energy Technology Co.Ltd(601012) , Trina Solar Co.Ltd(688599) , Risen Energy Co.Ltd(300118) , Jiangsu Akcome Science And Technology Co.Ltd(002610) , and the leader of glass auxiliary materials in the industry chain Flat Glass Group Co.Ltd(601865) .
Risk tip: the price of silicon material remains high, and the export order of components is less than expected
