Interview: Chinese company Jolywood made its name in the solar backsheet industry but has recently taken large strides into high-effi¬ciency cell production. Jolywood’s SVP and General Manager of its high-e¬fficiency cell division Liu Yong recently discussed the company’s technological goals and strategic aims with pv magazine at the PV Expo in Tokyo.
PV magazine?Can you talk us briefl¬y through Jolywood’s company ethos and its latest product announcements?
Liu Yong: Jolywood’s focus is on high-e¬fficiency products. Most of the products that we have presented at PV Expo represent the latest technology and the highest power rank. We are exhibiting our 60-cell module power of 330 watts (W) to 340 W. If you consider that it is bifacial, then the power rating is closer to 400 W. For a single-sided module we would mark it as 340 W, but if you include the back side, which offers around a 20% power rating increase, it is more like 400 W.
Jolywood produces n-type technology, and we are probably the largest n-type cell manufacturer in the world. We have 2.1 GW designed capacity, and right now 1.2 GW is fully in production. The remaining capacity is targeted to be in production by August this year. So at the end of 2017 we will have around 2.1 GW of n-type cell capacity. This will make us the world’s largest n-type manufacturer.
The technology we use today is bifacial cell and module technology, where our front side e¬fficiencies range around 21.5%, and backside is around 19.5%. This is the range we are working with. If it’s a 60-cell module, depending on how you calculate the backside power gain – we use 10%, which is a conservative number to focus on given that rear side effi¬ciency gains can be as much as 30% – the extra gain from the rear side will deliver a clear benefit to our customer.
So if we market our products based on a 10% back side gain, and the front side module power is around 315 W – 340 W, the gains really come from the rear side technology. And by using thin glass technology, the module e¬fficiency will be even higher.
PV magazine?What is the cost/efficiency trade off with these modules?
Liu Yong: Cost-wise I cannot give you the exact number because that is confidential, but we have a market slogan: “n-type, p-type, same selling price” – that is what we target, and is the key idea that we market this year. Our selling price per watt is similar to PERC technology, around CNY 3.4 per watt ($0.49/W). We sell at the same price, and it is a price that allows us to enjoy a reasonable margin. The cost increases come from the silver costs. With double-sided modules silver consumption is almost double, and that is the main cost increment. But we will introduce technology in H2 2017 that will allow us to reduce silver consumption by 20-40%. This will give us potential to further reduce total cell costs.
We are also developing new module technology that allows us to further increase the module power output. In this way the module costs will be even lower. With cell costs reduced, and new module technologies, we are confident that we can compete on price with p-type technologies.
PV magazine?No market would turn its nose up at affordable, high-efficiency modules and cells. Which markets are proving most responsive to Jolywood technology right now?
Liu Yong: In 2017 we have already had large orders from Japan, and have successfully penetrated the Japanese market. We have amassed orders of 100 MW in Japan, which is significant. Our products are well accepted there. Of course, the major market for us is China, where we have a large number of customers ranging from several hundred thousand kilowatt orders to multi-megawatt orders.
The orders we have received are already higher than what we can deliver in 2017, without giving too much away about specific numbers. Our order book already exceeds our capacity. We have a project close to 30 MW in China that uses 100% of our n-type bifacial module. That is one example of our strength. And we have already delivered several projects sized around 5-10 MW. The Chinese market has been receptive to our products because the Top Runner program places an emphasis on the adoption of high-effi¬ciency technologies. Jolywood cells have e¬fficiencies that are far higher than the entry threshold. Right now the second Top Runner program is in the works, and effi¬ciencies for this are set to be even higher. Our technology is one of just six that will meet these requirements currently.
Because our technology offers a low LCOE – we can deliver LCOE at below CNY 0.5/kWh ($0.07/kWh) with this technology – installation costs in terms of construction, racking, and labor for a 100 MW project are able to see savings of around CNY 50 million ($7.25 million) during the construction phase using Jolywood technology. Within 25-30 years, our double-glass bifacial module gives customers a 30 year guarantee.
PV magazine?How do you seek to maintain an industry-leading position in the face of stiff competition, while also continuing to innovate?
Liu Yong: We began this year with a large R&D investment, including hiring new staff and investing in new equipment. The investment is more than CNY 100 million ($14.5 million), and we have a dedicated R&D factory that boasts two complete cell lines for research, and additional state-of-the-art equipment. We can run technologies on the line, enabling staff to identify and solve problems in a practical way. We still continue to invest in R&D and hiring people worldwide, and have R&D staff not only in China, but also Taiwan, Singapore, and a few other locations. The next goal we have is to reach 22% cell e¬fficiency, and we are close to that. After that, 22.5% – and the technology road map we require to reach that has already been defined. One of them is IBC technology, but at lower costs than many of our competitors. This is not only a cell technology but a cell combined with different module technology.
PV magazine?How long are your lead times between lab to commercialization?
Liu Yong: The next generation of cells will be around 12 months for the 22% effi-ciency, and for the next phase of 22.5% I’m thinking 18-24 months.
PV magazine?China had a strong 2016, enjoying what was almost a year of two halves. It appears that we could be in for more of the same in 2017, so how does Jolywood prepare once again for something similar?
Liu Yong: For the Chinese solar market 2017 will be another good year. The focus again is on 30-34 GW, which is a realistic and reasonable number. At Jolywood, we are looking to next year, 2018, which is going to be tough for everyone with the cut of the FITs and the capacity increase of high-effi¬ciency technologies. There is a lot of demand for high-effi¬ciency and PERC modules right now, which is why we have set out to provide our n-type module to the Chinese market this year.
PV magazine?Does the apparent trend towards lower cost modules seen over the past few months worry a company like Jolywood?
Liu Yong: My feeling is that the key thing is to continuously improve quality, because it is at this point where you increase effi¬ciency – the point when all BOS costs will be reduced. This is the main factor for lowering costs. And you always have to keep in mind that more e¬fficient cells and modules do not always equate to higher costs. You have to find a balance. Land costs are increasing, and labor and construction costs are always increasing, so there is an onus on producers to increase effi¬ciencies, which then ushers in lower costs.
PV magazine?Every market has its own barriers to growth and challenges to overcome. If we look at India, the desire there seems to be to build as much capacity as quickly as possible. This runs the risk of impacting quality – do you share that view?
Liu Yong: India is an interesting market for Jolywood. Just recently we held interesting discussions with two Indian companies – leading developers in India – that were interested in our cell products. Even with our higher selling prices, the interest is still there, and that shows me that India’s solar developers are now thinking seriously about LCOE, and we are happy to help them to understand why using our products eventually offers better value for money.
We are willing to set up a sample power plant in India to demonstrate how our technology, with its power and e¬fficiency gains, offers cost savings. Although the PPA price in India is very low, I still feel like the solar resources in India make the country a good market for us. But it is a tough market. You have to understand the local culture, but we are seeing that the market is delivering returns. People understand that the solar technology is maturing, and China also is gaining a growing reputation for quality components
PV magazine?Does India’s desire to improve its domestic manufacturing capacity offer Jolywood opportunities, or further hurdles?
Liu Yong: The Indian domestic content requirement (DCR) projects are less than 10% of all projects, and it is really tough for domestic manufacturers to compete with Chinese companies. We have tried a few times to assess manufacturing opportunities in India, but the situation is still very tough, not least because a lot of the infrastructure we would need is lacking, such as poor roads, interrupted power lines, and even the approval process is too long – beyond 18 months. The domestic manufacturing is not there yet, and India has a strong need for solar power because many parts of the country are off-grid and have no access to electricity, which makes solar a good option for them.
PV magazine?We have also seen world-record low prices in the MENA region, allied to a growing desire to embrace PV. How is Jolywood positioned to serve these markets?
Liu Yong: We have it in our long-term plan to establish a manufacturing base in MENA. This is a big potential market, and it would be good for Jolywood to be closer to it. It is di¬fficult today, but the business environment is changing, and soon maybe we will be able to open facilities in India and MENA. The PPA price in MENA is extraordinarily low. It’s a tough business environment, and it is important to find a good partner, get familiar with the local market, and then make our move.
PV magazine?How does Jolywood view Europe, particularly with the impending end of the EU tariffs in 18 months’ time?
Liu Yong: Even with the fall in module prices and the antidumping barrier, the European market will be stable. Installation will be at reasonable levels, with the market becoming focused on distributed solar systems. And when we are talking about rooftops, customers will like the high-effi¬ciency products we offer. Our IBC products are ideal for rooftop applications, particularly in Europe where we can offer a reasonable price, too.
As mentioned, Jolywood is planning to have a manufacturing base overseas, somewhere outside of China. Perhaps in Japan, where we can guarantee our quality standards. This approach will allow us to better support the EU and American solar markets.