Author Jenny Lin
Updated September 27, 2023

As n-type technology matures, n-type products are gradually replacing p-type ones, with TOPCon being the most promising next-gen mainstream technology for cell manufacturing. The rising market share of n-type cells stokes concern about short BOM supplies, such as encapsulants.

InfoLink surveys resin supply and demand, providing an in-depth analysis of the potential encapsulant shortage.

Encapsulant and glass-backsheet/glass-glass modules

Previously, with lower production costs, glass-backsheet modules were the mainstream, as prices stayed elevated across the supply chain, and distributed generation projects were less price-sensitive. In 2022, the market share of glass-backsheet modules reached 60%. This year, glass-glass modules may secure a higher market share thanks to the rise of n-type products and construction initiation for centralized generation projects.

Contrary to glass-backsheet ones, glass-glass modules comprise two symmetric glass structures. This design provides better reliability, reduces the risk of cell cracks, and offers superior water and corrosion resistance. Glass-glass modules are more durable and can withstand scratches during construction. Some projects choose transparent backsheets out of weight concerns.

The popularity of glass-glass modules affects module makers’ choices of encapsulants. Categorized by material, there are three types of encapsulants: EVA, POE, and the co-extruded EVE encapsulant. For p-type modules, EVA encapsulant is the most widely adopted.

For n-type modules, most manufacturers choose the glass-glass configuration for higher reliability because n-type cells are more sensitive to water vapor. The design offers better water resistance than the glass-backsheet one, preventing water vapor from contacting the EVA encapsulant, reacting with the glass and resulting in potential-induced degradation (PID).

POE and EPE encapsulants on TOPCon modules

InfoLink expects module makers to ship 110 GW of TOPCon modules in 2023. As TOPCon module production capacity and the application of glass-glass design surge, module makers have higher standards for the water-resistant ability of encapsulants. Compared with EVA resin, encapsulants consisting of POE resin have higher-level physical properties, anti-PID capacity, and corrosion resistance. Due to the potential shortage of POE resin, the co-extruded EPE gradually gains traction among module makers.

EPE encapsulant encompasses the lamination capability of EVA encapsulant and the anti-PID feature of the POE one while possessing cost efficiency against the latter. However, drawbacks lie in the difficulty of controlling the thickness of the middle POE layer, additive migration, etc. Therefore, the application of EPE along with n-type cells still faces challenges and has room for further improvements.

Resin demand analysis

EVA encapsulant has been a dominating figure in the encapsulation process during module manufacturing. As module makers switch to n-type cells, the latent shortage of POE resin makes EVA resin even more indispensable.

This year, there are 390-455 GW of module demand, translating to 1,820,000 MT of EVA resin demand, compared with 1,920,000 MT of supply. Some resin manufacturers may increase the supply of PV-use EVA resin. Therefore, EVA resin supply will be sufficient for the PV industry throughout the year. An oversupply is likely if demand for PV-use EVA resin shows no substantial increase in the future.

Demand for POE resin will reach 470,000 MT this year amid the rise of n-type technology. Compared with that, the 420,000-480,000 MT supply seems tight. Production output of n-type products increasing at varying paces affects resin supply-demand dynamics. For example, the less-than-40-GW TOPCon module output in the first half of 2023 may reach 100 GW in the second half, meaning more resin demand and may lead to a short-term shortage of POE resin.

In view of this, most leading module makers switch to the co-extruded EPE encapsulant for TOPCon glass-glass modules unless customers request pure POE one. But in the first half of this year, most of them still chose POE+POE encapsulant. For n-type glass-backsheet modules, most module makers stick to the POE+EVA configuration.

Resin for module encapsulants

The prevalence of n-type modules boosts demand for POE resin. Estimation based on current resin consumption expects the tight supply of POE resin to remain over the coming two years. Therefore, module makers need to reduce the use of POE resin to balance demand. Recent industry surveys found some leading module makers decreasing the amount of POE resin in their EPE encapsulant to 150-170 g/m².

Other risks include 1) faster market penetration of n-type products, 2) POE supply for the PV industry from non-China manufacturers falling short of expectations, and 3) concern about the reliability of EPE encapsulant.

Recently, some encapsulant manufacturers have relocated outside China, given international trade uncertainties and geopolitical developments. For instance, First Applied and HIUV New Materials will commission production plants in Vietnam, becoming one of the most heeded topics in the industry.

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