Taiwan's largest energy exhibition Energy Taiwan 2023 offers a platform to facilitate business matching and explore cooperative opportunities. This year, the exhibition features sections of PV, wind energy, smart storage, net-zero, and emerging power, reflecting the diversified development of the renewable energy sector amidst international trends and the shifting policy environment.
Taking place from October 18 to 20, the event attracted participation from various manufacturers, developers, investors, green power and renewable energy certificate providers, the Bureau of Standards, Metrology and Inspection (BSMI), Engineering, Procurement and Construction (EPC) companies, and energy consultants.
InfoLink provides exhibition highlights for the PV market and the development of Taiwan's PV industry.
Demand flattens as election approaches and may revive next year
According to the Bureau of Energy, Taiwan added 1.7 GW of installed PV capacity from January to August this year, a 41% YoY increase, bringing the cumulative PV capacity to 11.4 GW as of August 2023. The figure falls 8.6 GW short of the 20 GW goal set by the Ministry of Economic Affairs for 2025, requiring an average addition of 3.7 GW per year. The industry is pessimistic about achieving the target, given the current speed of installation.
The market has been sluggish since the second quarter of this year as risks such as fewer tenders, review procedures stalling large ground-mounted projects, and protests of social groups delaying some projects put off investment.
Traditionally, the market is expected to be more active in the fourth quarter due to factors such as annual cuts in the feed-in tariff (FiT) rate and the arrival of grid connection deadlines. However, based on module manufacturers' order intake and feedback from developers, demand will remain subdued in the fourth quarter and is not expected to recover until the second and third quarter next year.
Competition with Southeast Asian modules intensifies amid price drops across supply chain
Last year, prices stayed elevated across the supply chain due to a polysilicon shortage, and module prices in Taiwan were no exception. This year, prices drop as polysilicon and wafer production capacity in China increase remarkably, resulting in an excess supply amid the lower-than-expected demand. Prices for M6 wafers, sustaining above USD 0.7/piece at the end of last year, have declined to USD 0.303/piece. Given significant cost reduction and the weak market demand, average prices for M6 modules in Taiwan fell from USD 0.48/W in the fourth quarter of 2022 to USD 0.36-0.37/W for the time being.
Prices for Taiwan-made modules has decreased but still don’t rival with the price-performance ratio of Southeast Asian modules, even with the VPC bonus. Currently, prices for Southeast Asian modules come in at USD 0.24-0.26/W, much cheaper than Taiwan-made modules while possessing superior efficiency. Therefore, self-developed projects without a strong preference for the place of origin of modules favor Southeast Asian modules for projects.
In the fourth quarter of this year, n-type modules from Southeast Asia started entering the Taiwanese market, intensifying competition for local manufacturers. Since early this year, Southeast Asia has exported over 300 MW of modules to Taiwan. Pressure is mounting for Taiwan-made modules.
Format and technology roadmap
The exhibition this year focused on the transition of product format. M6 PERC products still dominated the Taiwanese market in 2022 and the first half of this year, then became a special specification with a rapidly decreasing supply as M10 gains traction worldwide. Manufacturers in Taiwan started modifying lines for large-format products this year. Last year, only TSEC launched M10 products. This year, URE and AUO follow suit, and Gintung plans to introduce M10 modules next year. Project designs conform to M10 products increasingly, of which the market share expands swiftly in the second half of this year. In 2024, M10 will replace M6 to be the mainstream in Taiwan.
As for technology, TOPCon has established its mainstream position globally with higher bifaciality factor, lower attenuation, and better low-light performance of TOPCon cells. Taiwanese module makers adhere to the trend. However, except for Motech with its M6 TOPCon production lines, no Taiwanese manufacturer is capable of n-type production. But they have line modification plans. Given the time it takes for equipment move-in and acquiring verification, the supply of Taiwan-made TOPCon modules will not increase significantly until the second half of 2024.
1) Taiwan-made PERC modules
The selection of Taiwan-made modules still varies among different types of projects. Currently, most of the existing orders are for M6, but the design of new project sites has quickly switched to M10, and there were almost no M6 products at the exhibition this year.
2) Taiwan-made TOPCon modules
Most manufacturers exhibited M10 TOPCon modules this year. However, Taiwanese manufacturers have yet to be capable of M10 TOPCon production. M10 TOPCon modules locally made in Taiwan will not hit the market until the second quarter of 2024.
3) Other special-spec modules
To tap into niche markets through product differentiation, Taiwanese module makers introduced integrated and disassemblable products, increasing product competitiveness while being eco-friendly. Also worth noting were special-spec products tailored for Taiwan’s application scenarios.
Steady growth in the future
This year, market demand weakens due to the upcoming presidential election, with annual module demand potentially reaching 2.2-2.4 GW. In 2024, only one year away from the 2025 target deadline, the industry expects demand to recover in the second half of the year as policy uncertainties will abate after the end of the election. Taiwan sees limited growth in the rooftop PV market and must rely on ground-mounted projects to sustain long-term development. Currently, ground-mounted projects face challenges in fragmented land rights and feeder acquisition, to which solutions have yet to emerge. InfoLink expects demand to grow steadily in 2024 and 2025, sustaining annual module demand at 2.5-3 GW in the long run. Significant increases are not likely.