2. Photovoltaic Industry Chain

2.1 Overall Situation of the Photovoltaic Industry

In 2022, the global photovoltaic installed capacity increased by 191.5GW, with the increase mainly coming from the Asian region, accounting for 58.5% of the total new installed capacity. In 2022, China's newly installed photovoltaic capacity reached 87.4GW, with the total installed capacity increasing to 392.6GW. Among them, centralized photovoltaics added 36.3GW, a year-on-year increase of 41.8%; Distributed photovoltaics added 51.1GW, a year-on-year increase of 74.5%, with an average annual growth rate of 24.6% from 2017 to 2022. According to the prediction of the China Photovoltaic Industry Association, during the 14th Five Year Plan period, the annual average installed capacity of domestic photovoltaics will increase by 94GW, and the cumulative installed capacity of photovoltaics will reach 720GW by 2025; From 2025 to 2030, the average annual increase in installed capacity will be around 120GW.

The photovoltaic industry chain mainly includes three parts: upstream raw material and equipment manufacturing, midstream packaging, and downstream electric field construction and maintenance. The raw materials mainly include photovoltaic silicon materials, photovoltaic film materials, backboard materials, and equipment materials, etc; The packaging components mainly consist of battery cells, packaging film, and backboard; Photovoltaic power stations are mainly divided into centralized power stations and distributed power stations.

Petrochemical materials are mainly used in the manufacturing of encapsulation films, backboards, and other component parts. At present, China is the world's leading exporter of components, with a relatively mature photovoltaic industry and a market size of over 350 billion yuan, with the largest market space in the material sector. According to estimates, the demand for petrochemical materials in China's photovoltaic industry chain is nearly 1.9 million tons in 2022; With the rapid development of the photovoltaic industry, it is expected to grow to around 3.5 million tons by 2030.

2.2 Application and Market Situation of Main Petrochemical Materials in the Photovoltaic Industry Chain

In the photovoltaic industry chain, the demand for petrochemical materials is the highest for adhesive films, backboards, and building photovoltaics.

2.2.1 Photovoltaic Grade Adhesive Film Materials

At present, the packaging materials on the market mainly include EVA film, POE film, EPE film, and other packaging films. Among them, EVA film is the mainstream packaging material, accounting for about 64% of the total packaging film in 2022, followed by EPE film and POE film, accounting for about 12% and 24% respectively. 

During the 14th Five Year Plan period, the total demand for photovoltaic film materials will continue to increase rapidly. Although the global economy is facing risks such as slowing growth and high inflation in the post pandemic era, the trend of global energy structure transitioning towards diversification, cleanliness, and low-carbon is irreversible. It is expected that during the 14th Five Year Plan period, the global photovoltaic industry still has high development potential, and the new and replacement installed capacity will continue to support the demand of the photovoltaic industry in the coming years.

From the perspective of adhesive film material structure, as the market share of double glass components gradually increases, the demand for transparent EVA adhesive film, POE adhesive film, and EPE adhesive film will gradually increase.

In 2022, China's EVA production capacity continued to expand to approximately 1.56 million tons per year, with a photovoltaic material production of around 280000 tons in 2022. Due to production technology limitations, there have been relatively few enterprises in China that can actually produce photovoltaic materials in recent years. In the short term, the photovoltaic material market will still be led by Selbond, followed by Lianhong and Ningbo Formosa Plastics. At present, the global POE production capacity is basically monopolized by foreign enterprises, and China's POE is completely dependent on imports. However, there are already multiple domestic enterprises tackling POE technology, among which Wanhua Chemical has completed pilot testing and is expected to produce 200000 tons of POE equipment annually by 2024; In addition, Maoming Petrochemical, Selbang, Satellite Petrochemical, and Wison Engineering have all proposed planning POE projects or are already in the pilot stage, and the localization process of POE is expected to accelerate.

According to statistics from the National Energy Administration, the demand for China's photovoltaic industry continued to be strong in 2022, with an additional installed capacity of 87.41GW, a year-on-year increase of 59.27%. The photovoltaic industry is undergoing a new round of large-scale production capacity investment. In 2022, the demand for photovoltaic grade EVA and POE resin in China is approximately 1.3 million and 220000 tons respectively. According to the photovoltaic industry association's prediction, the average annual increase in photovoltaic installed capacity from 2025 to 2030 is about 120GW. It is expected that the demand for photovoltaic grade EVA and POE will increase to 2.2 million and 500000 tons respectively by 2030.

2.2.2 Photovoltaic Backboard Materials

Photovoltaic backboard is the packaging material on the back of photovoltaic modules, located at the bottom layer of photovoltaic modules and mainly used for single glass modules. The main function of photovoltaic backboards is to form protective support for the battery cells, resist the erosion of materials such as the battery cells and EVA film by humid and hot environments. The insulation, water resistance, and aging resistance of the back panel have a significant impact on the durability and power generation efficiency of photovoltaic panel products.

At present, the backboards on the market are mainly divided into organic polymer and inorganic materials. Organic polymer materials include double-sided fluorinated, single-sided fluorinated, and fluorine-free types, while inorganic materials mainly consist of glass.

In 2022, based on the current thickness of the backboard and fluorine film coating, the demand for PET resin for photovoltaic backboard base film is estimated to be about 264000 tons, and the demand for PVF and PVDF is about 10000 tons, respectively. It is expected that by 2030, the demand for PET, PVF, and PVDF materials for backboards will increase to approximately 60, 18, and 23 thousand tons, respectively.

2.2.3 Building Photovoltaic Materials

Building Attached Photovoltaic (BAPV) refers to the technology of attaching photovoltaic equipment to buildings, and is currently the mainstream type of photovoltaic building. Building Integrated Photovoltaic (BIPV) refers to the solution of integrating photovoltaic products into buildings, which is not only a power generation device but also a part of the external structure of the building. It can effectively reduce costs while also considering aesthetics. At present, the BIPV industry is in its early stages.

Photovoltaic curtain wall is a special resin used to paste solar cells onto glass, embedded between two pieces of glass, and convert light energy into electricity through the battery. In addition to power generation, photovoltaic curtain walls also have obvious functions such as heat insulation, sound insulation, safety, and decoration. They are a green product and have good compatibility with the environment.

The integration of photovoltaic buildings has higher requirements for functional membranes, as in addition to using the building to generate electricity, the safety of the building also needs to be considered. Due to the aging, yellowing, decreased tensile strength, and adhesive strength of components made of EVA film exposed to ultraviolet radiation, their safety performance is far from meeting the requirements. More and more countries prohibit the application of laminated glass made of EVA film in building curtain walls. Therefore, better performing PVB membranes are gradually being applied in the integration of solar photovoltaic buildings. In 2022, the demand for PVB films in China is about 27000 tons, and it is expected that by 2030, the demand for PVB films will increase to 58000 tons.