This is a magnificent topic. However, the development of the industry will be affected by the world situation, especially the already quite mature photovoltaic and lithium battery industry.

Nowadays, the global order enters a new round of reconfiguration, from trade strife, to local conflicts, to energy crisis, as the best partner of lithium battery energy storage system - photovoltaic industry, once again comes to a new fork in the road.

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The photovoltaic industry has considerable relevance to the lithium battery industry, so let us sort out their expectations for you below.

A: The impact of trade frictions on the photovoltaic industry

This round of trade disputes, from the "201 tariff investigation" to "301 tariff investigation", from the "forced labor bill" to the "inflation reduction bill ", the trend is very obvious, that is, China and the United States decoupling!

For a variety of "trade war", sanctions, China PV is no stranger, but in the global trade disputes continue to grow, from 2011 "double reverse" began, the stronger the fight, and finally become the "world king ".

By 2021, China's top five polysilicon, wafer, cell and module companies market share reached 86.7%, 84%, 53.9% and 63.4%, respectively.

In fact, only 4.2GW of U.S. PV was installed in the first half of 2022, compared with 13.5GW installed in the same period last year, down 69% year-on-year. Among them, in the first half of 2022, China's direct exports of PV modules to the United States only about 0.18GW, almost negligible.

Not only the United States, the European Union has recently proposed similar restrictions on forced labor bill, which may take effect at the end of 2024 if the final approval is passed.

However, the overall impact of these policies is manageable.

As for the "tariff investigation", Chinese component companies have long been circumventing it by building factories in Southeast Asia. Earlier this year, the United States announced an "anti-circumvention investigation" of PV imports from Southeast Asian countries. But may be due to the decline in installed capacity is too fierce, in June this year, the United States and announced two years not to impose new tariffs on photovoltaic imports, meaning that imports from Southeast Asia components are not affected in the short term.

This shows that the United States in the photovoltaic game is at a disadvantage, as for wanting to build their own production capacity to seek industrial independence, the face of China's strong industrial chain advantage is not an easy task.

As for the "forced labor bill", at present, mainly for the local sensitive origin of silicon, but with the silicon production capacity released one after another and regional layout diversification, the proportion of sensitive areas will also be reduced, even after two years in Europe to follow up, the impact is also limited, China's domestic and outside Europe and the United States PV installation, fully capable of digesting sensitive areas of silicon Capacity.

The data better illustrate the global performance of China's PV, and the suppressed demand for installed capacity in the U.S. will make up for it. 2022 January-August, China's total PV exports reached $35.77 billion, and PV module exports reached 113GW, up 80% year-on-year.

As long as there is demand for PV, the pattern of China's PV dominating the global market will not change, unless the rest of the world, like the United States, "cut itself off from demand" to stop China's PV advances.

B: The energy crisis is a "booster" for the new energy industry

The Russia-Ukraine conflict has ignited this round of energy crisis, with Europe bearing the brunt of it.

In the natural gas, coal and oil three traditional energy fields, Russia is the first supplier of the EU, accounting for 40%, 45% and 27% respectively. And in the European power structure, natural gas power generation accounted for about 20%, coal power accounted for about 15%.

As a result of the Russian-Ukrainian conflict, European gas prices have increased more than 10 times year-on-year. As a result of the energy crisis and food supply, inflation in the EU reached 10.1% in August 2022, while some industrial capacity was halted or even shifted to countries with greater energy security.

Because of the low self-sufficiency of traditional energy sources such as oil, coal and natural gas, making Europe has historically been hit harder by the energy crisis, which is an important reason why Europe is focusing on the development of nuclear power, wind power and photovoltaics.

For this reason, Europe has become an important global PV market. 2021 global PV installation, Europe accounted for about 17%, second only to China 52% and the Americas 21%, the cumulative installed capacity is second only to China. In China's PV module exports, Europe accounted for 54% in the first half of this year, the largest export market for China.

By the energy crisis and expected impact, European PV installation is still accelerating. In the first half of this year, China exported 42.4GW of PV modules to Europe, up 137% year-on-year. The European Union launched a solar strategy in May this year, plans to double the photovoltaic power generation capacity by 2025, 600GW installed by 2030. in addition, there are many other energy strategies also involved in photovoltaic.

Europe's situation is different from the United States, the United States has a strong traditional energy reserves as well as traditional energy influence, high energy self-sufficiency, and the global energy pattern is still an important component of its world order, the strategic position of PV is not obvious, PV policy is a footnote to the capricious performance.

Europe's traditional energy is relatively scarce, the energy self-sufficiency rate is low, industry and people's livelihoods are constrained by the global energy pattern, PV is a real rigid demand, not a luxury, "carbon neutral" is not just talk, it is impossible to deal with the PV industry like the United States, which is a market that China PV can rely on for a long time with its strength.

Photovoltaic power generation + energy storage system is an important energy supply, they are for the lack of traditional energy in Europe is an important tool to get rid of the traditional energy shortage of oil, coal and natural gas.

The global reshuffle of order is exacerbating a new energy crisis. Since the oil crisis, the world has never paid as much attention to energy issues as it does today, and PV + lithium batteries are expected to benefit from this.

C: China's PV + Li-ion battery industry has a bright future

We must acknowledge two facts.

One is the global competitive position of China's PV industry + lithium battery industry, and because of the semiconductor properties of the PV industry, technology is still iterating and the competitive logic is still being updated, making it difficult for latecomers to keep up.

Second, under the global order reshuffle, "energy crisis" + "carbon neutral", become another driving force for the development of new energy industry, PV and energy storage system become rigid demand, especially in China, Europe and Japan and South Korea, etc.

With these two facts, China's new energy industry need not be afraid of this round of global order agitation, and may even usher in a new round of development and growth, just like the past trade strife.

Imagine that the EU's recently proposed bill to restrict forced labor, even if finally approved, will not take effect until the end of 2024, a two-year transition period that is expected to have little impact on China's rapidly growing new energy industry.

Today, China not only has a cost-performance advantage in end products, but also a strong integrated advantage in the entire industry chain, including technology, equipment, materials, labor costs and energy costs. In particular, energy costs, China's current traditional power system of "thermal power as the main source, hydropower as a supplement", provides the basis for lower PV manufacturing costs, disguised as cheap PV products exported to help overseas to absorb inflationary pressures.

Globally, new energy has become an affordable, free product, and as new energy is impacting the dominance of traditional energy sources, it is expected to impact the global order with traditional energy as the grip. From this perspective, the new energy industry, especially photovoltaic and lithium batteries, will have a controversial and imaginative future.