According to the latest NPD Solarbuzz Polysilicon and Wafer Supply Chain Quarterly report, the growth in demand for polysilicon is being driven by the rapid increase in end-market solar photovoltaic (PV) module shipments, which are now expected to reach approximately 49 gigawatts (GW) this year.
Polysilicon used for semiconductor applications typically requires very high purity of 11N (99.999999999%) and very low levels of contaminants. Semiconductor polysilicon is a high value-added segment, but future demand growth in this mature market is only expected to be modest. In contrast, solar PV polysilicon has less stringent purity requirements, but it can experience very high growth rates when there is a strong demand for solar panels, yet the growth trajectory in polysilicon supply and end-market demand is not always directly correlated.
It can three to six months after production for polysilicon to be converted into wafers and cells, and then shipped as finished modules for installation. This lag time can push the demand higher than module demand in a rapidly expanding market.
“Conversely, the amount of silicon required per watt at the module level has been declining steadily each year” said Charles Annis, vice president at NPD Solarbuzz. “Solar supply chain companies have lowered the number of grams-per-watt by reducing wafer thickness and kerf loss, increasing yields in all manufacturing steps, reducing module loss, and continuously raising panel efficiency.”
By the end of 2014, the average amount of silicon used in a solar module will fall by 55 percent to approximately 5 grams per watt. This is expected to continue, though at a slower rate, as many of the material reduction steps implemented to decrease polysilicon consumption have now been exhausted. Robust end-market solar PV demand continues to drive polysilicon production levels. This, in turn, raises module efficiencies and reduces costs, which will remain important priorities across the entire solar-PV supply chain, in order to increase profitability in 2014 and stimulate increased end market demand in future years.
