The world of renewable energy is witnessing significant shifts, especially within the solar industry, where companies are grappling with technological advancements and evolving market dynamicsTwo months ago, Tongwei Co., Ltd., a major player in the photovoltaic (PV) silicon industry, denied rumors about recruiting staff for granular silicon technologyHowever, recent publications confirm the company's intentions are indeed aligned with this area of development, further cemented by an environmental assessment report that showcases their plans for granular silicon productionThis pivot appears to reflect the growing recognition of granular silicon's potential within the market, particularly as the technology matures and demonstrates tangible benefits over traditional silicon forms.
Under the umbrella of Tongwei, Sichuan Yongxiang Co., Ltd. specializes in high-purity crystalline silicon productionThis company’s operations sit at the upstream end of the PV industry chain, supplying raw silica material that undergoes crystallization and slicing to create silicon wafersThese wafers are subsequently transformed into solar cells and PV modules, forming the backbone of solar technologyThe silicon supply chain is crucial, affecting everything from costs to performance.
The planned granular silicon production at Tongwei is set to adopt the silane method, which is characterized by multiple production steps including silane gas preparation, granular silicon fabrication, hydrogen compression, and subsequent post-processingAn expert in silicon materials indicated that this granular silicon aligns closely with current market expectations and technologiesThis technology represents a crucial development in a sector traditionally dominated by rod-shaped silicon, produced primarily via the improved Siemens method.
Currently, rod-shaped silicon retains the majority market share due to its established production techniques, while Tongwei stands as a leader in this sector
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However, [...] adapting granular silicon production is seen as a strategic move to bolster their competitive edge, optimizing costs and creating more advanced product offerings through complementary processes and innovationsThe competitive nature of the solar market necessitates such strategic shifts to maintain and increase market share amidst rising demand and technological evolution.
Complications arose in December 2024 when a recruitment advertisement for granular silicon technicians surfaced online, leading to speculation that Tongwei was pursuing this technologyIn response, Tongwei clarified to the media that the information was inaccurate and no such hiring initiatives or production plans were underwayNotably, although theoretical analyses suggest that granular silicon presents lower energy consumption and cost structures, historical issues such as technical difficulties, impurity levels, and unstable quality have limited its widespread adoptionOnly companies like GCL Technology Holdings, once a leader in silicon material, have steadfastly pursued this potentially transformative approach.
In recent years, GCL has demonstrated the real-world potential of granular silicon through its applications and has effectively reduced costs, showcasing the feasibility of this technologyAs Tongwei navigates this landscape in pursuit of granular silicon, it will encounter challenges including technology implementation, competitive pressures, and the complexities surrounding intellectual property.
According to a technology roadmap released by the PV association, the market share of granular silicon grew from just 4.1% in 2021 to approximately 17.3% in 2023, underscoring its increasing acceptance in the industryAdvancements in technology have led to cost breakthroughs, positioning granular silicon as a viable solution, especially for companies aiming to meet carbon reduction targets, with its superior carbon footprint metrics becoming appealing to environmentally-conscious enterprises.
GCL has reported a substantial market presence for its granular silicon, claiming over 20% of global silicon material share
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For individual clients, this form of silicon constitutes between 40% and 50% of their raw material procurement, with some reaching upwards of 70%. GCL projects a granular silicon output of around 269,200 tons in 2024, demonstrating the growing reliance on this technology.
In a similar vein, LONGi Green Energy, a leading integrated manufacturer in the sector, revealed in January that they have incorporated a certain percentage of granular silicon in silicon wafer productionAdditionally, JinkoSolar, another titan in the PV industry with the highest component shipment numbers, reported that it had mastered the necessary techniques to incorporate higher proportions of granular silicon into its production processes, controlling impacts on yield, efficiency, and quality.
Financially, GCL has achieved significant reductions in the cash costs of granular silicon production, reporting a steady decline from approximately 37.84 CNY/kg in the first quarter to around 28.17 CNY/kg in the last quarter of 2024. Conversely, Daqo New Energy, another leading rod silicon producer, reported higher cash costs of roughly 40.5 CNY/kg in the first quarter and 38.93 CNY/kg by the third quarter of the same yearThus, GCL's robust cost reduction strategy positions it favorably against competitors in a cost-sensitive marketplace.
Moreover, granulated silicon exhibits a significantly lower carbon emissions profile—less than half of that of traditional rod siliconAccording to certifications from France’s Agency for the Environment and Energy Management (ADEME), the carbon footprint for GCL's granular silicon is approximately 24.91 kg of CO2 per kilogram, whereas rod silicon generates about 58 kg of CO2 for the same quantityThis substantial disparity supports the industry trend toward low-carbon production methods, which could influence procurement decisions favorably toward their granular offerings.
As granular silicon technology matures and gains traction, Tongwei's decision to explore this production method seems increasingly justified
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Nevertheless, the company faces critical hurdles in technology deployment, intellectual property issues associated with existing competitors like GCL, and the necessity to manage its substantial investments in rod silicon assets effectively.
Aside from technical advancement, Tongwei's planned first-phase trial line for granular silicon production is geared towards a mere 10,000 tons, with a two-year construction periodObservers suggest that Tongwei must navigate through three significant challenges: achieving feasible technological breakthroughs; overcoming GCL's established intellectual property barriers; and, given the prevailing overcapacity in the market, securing meaningful product acceptance amidst fierce competitionWith substantial resources already allocated to rod silicon—a market segment that has yielded over 800 million CNY in assets—how Tongwei manages this dual engagement could define its future trajectory.
On the technical front, GCL's historical path can serve as a valuable referenceStarting its granular silicon initiatives around 2011, GCL first achieved silane production in 2012, but faced setbacks in scaling up the fluidized bed component of production until it acquired pertinent patents and capabilities through acquisitionsAs of 2021, GCL announced an all-in commitment to granular silicon, fully withdrawing from rod-based production.
Conversely, Tongwei must not only master the silane production phase but also effectively navigate the complexities of the fluidized bed process, critical to ensuring stable quality in granular silicon productionExisting dialogues within the industry indicate a need for keen awareness not only of GCL's proprietary advancements but also of innovations like those from Norwegian REC's technologiesThe flows of technology and expertise often come with complex copyrights that can stymie nascent enterprises entering this space.
In China, firms such as Xi'an Tianhong Ruike have pursued collaborations with REC's technologies, albeit with limited outcomes that add to the cautionary tales in the sector
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