Cutting finance costs could double size of global PV market, says LONGi

While there are many technology gains still to be exploited, LONGi's Xia said finance offered huge scope for LCOE reductions. Source: LONGi

Lowering the cost of finance could lead to dramatic reductions in the levelised cost of energy (LCOE) of solar, according to LONGi Solar.

Speaking to PV Tech, VP of overseas marketing at LONGi, Max Xia said the entire value chain had work to do to trim down the LCOE but the most substantial gains could be achieved by slashing interest rates.

“The final important piece of the puzzle is reducing the cost of finance,” said Xia. “We need support from development banks. If we could drive down interest rates from 8% to 1% or 2% we believe the LCOE could fall by as much as 50%. The Chinese government is looking to do more work on reducing the financial costs of LCOE as well as grid costs and land costs.”

“Together, all these elements, from polysilicon to system performance and finance, can drive down the LCOE. We think if we reduce the LCOE by 10-20%, the global industry would double in size. We'll see 20-30GW markets annually in each of Africa, India and the Middle East,” he predicted. “Grid parity in China is now less than two years away, perhaps one year. To get there globally, we need the entire value chain to perform.”

Technology gains

LONGi has its own preferred route for achieving these gains based on its advocacy of monocrystaline PERC technology. Xia ran through the improvements the industry has in its reach to drop LCOE beyond the tipping point for widespread grid parity.

“Polysilicon supply in China needs to improve its quality. This will take some time particularly for higher quality N-type. Secondly, we need larger scale mass production to reduce the price of polysilicon. From the ingot and wafer side, we need the capacity to increase and costs to fall again but this is happening as we see more and more people turning to diamond wire. On cells and modules, mono PERC, and black silicon for multi will help improve efficiency and lower costs further.

“At a system level, bifacial, glass-glass with trackers will put costs up but increase the project lifespan and the yield. There is good potential for this technology in distributed generation projects as well. Power China has some expertise and is also looking at ways to improve system performance and O&M.

“Together, all these elements, from polysilicon to system performance and finance, can drive down the LCOE,” said Xia.

4 October 2022
Solar & Storage Finance USA, the only event that connects developers to capital and capital to solar and storage projects, will be back in November 2022.
11 October 2022
PV CellTech Extra will be held as a series of live webinars and on-demand sessions on 11-13 October 2022. We'll be taking a slightly further forward-looking view at the technologies and roadmaps for new cell architectures set to dominate mass production during 2023-2025 with special emphasis on the potential timelines for technologies beyond the single-junction cell design, including perovskite and hybrid concepts.

Read Next

September 27, 2022
Nearly a third of all renewable technologies employment came from the solar PV industry in 2021, according to a new report from the IRENA.
PV Tech Premium
September 27, 2022
Europe must build out its own large-scale, vertically integrated solar PV manufacturing base as a means to ensure its clean energy transition.
September 27, 2022
Tongwei has announced plans to sign an investment agreement to develop a 25GW high-efficiency PV module manufacturing base in China
PV Tech Premium
September 26, 2022
The way that solar companies use and consume intelligence needs to change, with more accurate and reliable data on project deployment needed, especially in light of the recently passed Inflation Reduction Act (IRA).
PV Tech Premium
September 23, 2022
Plans for a temporary revenue cap on solar PV assets across the European Union (EU) could dent investor confidence in renewables, experts have warned, amid concerns that individual member states may be able to set lower caps specific to different technologies.
September 23, 2022
Solar accounted for half of all global power generating capacity added last year, with 182GW deployed, a 25% increase on 2020, according to a report from BloombergNEF (BNEF).

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
September 27, 2022
15:30 AEST (UTC +10)
Solar Media Events
October 4, 2022
New York, USA
On-Demand Webinars, Solar Media Events
October 11, 2022
Virtual event
Upcoming Webinars
October 18, 2022
10am (EDT) / 4pm (CEST)