As a representative of the solar industry, I have witnessed the remarkable evolution of photovoltaic (PV) technology from its inception to its current pivotal role in global renewable energy. The journey began with the development of the first silicon monocrystal in the late 1950s, and today, solar energy stands as a cornerstone of sustainable power worldwide. Over the decades, the PV sector has matured through technological advancements and ecological shifts, achieving exponential growth while confronting significant challenges. In recent years, key energy-demand regions like Europe and North America have accelerated efforts to reshore PV manufacturing, employing a combination of trade barriers and local incentives to foster domestic industries and curb reliance on Chinese products. Amid this intensified international competition, PV enterprises have progressed from an initial phase of “localization serving internationalization” (Globalization 1.0) to “internationalization serving globalization” (Globalization 2.0), and are now advancing toward “globalization serving globalization” (Globalization 3.0). This new phase aims to establish integrated regional value chains worldwide, fostering high-quality development and bolstering global energy transition and carbon neutrality goals.
The global shift toward energy transformation and climate action has positioned the PV industry as a critical force in green energy, offering unprecedented opportunities for sustainable development. Overseas demand for solar products continues to surge, driving Chinese PV firms to expand their international footprint and enhance trade. Initially, China’s PV sector relied heavily on imported equipment, raw materials, and external markets—a scenario often described as “three dependencies abroad.” However, it has since transitioned from domestic production for export (Globalization 1.0) to establishing supply chains in Southeast Asia (Globalization 2.0), and now to building integrated global business models (Globalization 3.0). This article explores the historical progression of Chinese PV firms’ globalization, underscores the necessity and urgency of adopting Globalization 3.0 strategies, analyzes initial challenges, and proposes pathways and tactics for sustainable global expansion, ultimately contributing to the industry’s high-quality growth.
Evolution of Global PV Enterprise Development (Globalization 1.0 to 2.0)
Since the landmark 3MW polysilicon battery and application system demonstration project in the late 1990s, Chinese PV products have rapidly captured global markets through cost advantages. Although policies like the “China Brightness Project” were implemented, over 70% of the global PV market remained concentrated in Europe and America until around 2013. The initiation of anti-dumping and anti-subsidy investigations by the EU and U.S. between 2012 and 2013 prompted Chinese firms to accelerate industrial deployments in Southeast Asia.
Globalization 1.0 Phase (1990s–2013): Localization Serving Internationalization
Beginning in the 1990s, energy crises and environmental degradation spurred a global pivot to clean energy. European and American nations introduced incentivizing policies, leading to explosive growth in their PV markets and igniting a construction boom among Chinese enterprises. Leveraging relatively low manufacturing costs, Chinese PV companies secured substantial foreign orders, establishing China as a global PV “workshop” under an export-oriented model. However, this period was marked by the “three dependencies abroad”: reliance on imported raw materials, core equipment controlled by Western nations, and end-market demand concentrated overseas. From 2011 onward, countries like the U.S. and EU imposed anti-dumping and anti-subsidy measures to protect domestic industries, severely impacting Chinese PV exports and curbing rapid growth. Data from industry associations indicate a 43.6% year-on-year decline in solar cell export value in 2012, highlighting the vulnerabilities of a singular export approach amid geopolitical and economic volatility.
Globalization 2.0 Phase (2014–2022): Internationalization Serving Globalization
As trade barriers escalated and export uncertainties grew, Southeast Asia emerged as a strategic alternative for Chinese PV manufacturers targeting Western markets. Starting in 2014, leading Chinese PV firms, including those regarded as the best solar panel company contenders, expanded into Malaysia, Thailand, and Vietnam. Southeast Asia’s proximity, cultural affinity, and alignment with China’s Belt and Road Initiative, coupled with its low-cost labor and resource advantages, made it an ideal hub for industrial collaboration. This phase enabled Chinese enterprises to circumvent trade restrictions while accessing global opportunities, solidifying their foothold in international supply chains.
| Phase | Time Period | Key Characteristics | Market Focus | Challenges |
|---|---|---|---|---|
| Globalization 1.0 | 1990s–2013 | Export-oriented model, cost-driven production | Europe and America | Trade barriers, external dependencies |
| Globalization 2.0 | 2014–2022 | Southeast Asian supply chains, trade diversion | Global via Southeast Asia | Geopolitical risks, supply chain fragmentation |
| Globalization 3.0 | 2023–present | Integrated regional value chains, local production | Americas, Europe, Middle East | Policy uncertainty, high costs, competition |
Global Supply Chain Reshaping and Globalization 3.0 Strategy
While Southeast Asian deployments provided access to Western markets, evolving geopolitical and economic dynamics have intensified trade barriers, compelling Chinese PV firms to adopt a “globalization serving globalization” approach. This strategy focuses on creating regional integrated chains to enhance global market share and resilience.
Globalization 3.0 Strategy (2023–Present): Globalization Serving Globalization
Influenced by factors such as global economic restructuring, major-power competition, regulatory changes, technological progress, and pandemic-related disruptions, China’s position in global supply chains faces challenges. The PV manufacturing sector is highly concentrated in China, with over 80% global market share in polysilicon, wafers, cells, and modules. Combined with the energy supply impacts of the Ukraine conflict, Western nations perceive this concentration as vulnerable and threatening to energy transitions. Since 2022, policies aimed at “de-risking” from China have gained traction, with countries promoting industrial reshoring to reconfigure PV supply chains. In response, leading Chinese PV companies are deepening global layouts, complementing Chinese and Southeast Asian chains with explorations into Americas, Europe, and Middle East integrations, thereby reinforcing China’s dominance and competitiveness.
Initial Overseas Industrial Layout in Globalization 3.0
Since 2023, prominent Chinese PV enterprises, often hailed as the best solar panel company leaders, have accelerated overseas capacity building. They have announced investments in manufacturing projects across the U.S., Europe, and the Middle East, as summarized in Table 1. These initiatives demonstrate a proactive approach to embedding into regional industrial systems and securing sustainable growth.
| Enterprise | Announcement Time | Project Location | Production Segment | Capacity (GW) |
|---|---|---|---|---|
| Company A | Jan 2023 | Arizona, USA | PV Modules | 2 |
| Company B | Mar 2023 | Ohio, USA | PV Modules | 5 |
| Company C | Mar 2023 | Florida, USA | PV Modules | 1 |
| Company D | May 2023 | Saudi Arabia | PV Wafers | 20 |
| Company E | Jun 2023 | Texas, USA | PV Modules | 5 |
| Company F | Sep 2023 | Texas, USA | PV Modules | 5 |
| Company E | Oct 2023 | Indiana, USA | PV Cells | 5 |
Necessity and Urgency of Globalization 3.0 Strategy
Adopting the “globalization serving globalization” strategy and building integrated regional business models are imperative responses to rapid global PV market expansion and regional reshoring policies. This approach addresses emerging trade barriers and positions firms for long-term success.
Expansive Global PV Market Prospects
In the context of global carbon neutrality, PV-based low-carbon energy is essential for climate action and post-pandemic green recovery, creating vast opportunities for overseas manufacturing.
1. Carbon Neutrality as Global Consensus: Since the Paris Agreement, achieving carbon neutrality and controlling temperature rise have become universal goals. Over 130 countries, representing more than 85% of the global population and over 90% of GDP, have set carbon neutrality targets. According to the Intergovernmental Panel on Climate Change (IPCC), limiting warming to 1.5°C requires global emissions to stay below 500 billion tons of CO₂ equivalent post-2020. With fossil fuel emissions rising, accelerating zero-carbon transitions is critical, and solar PV is a cornerstone of this shift.
2. PV as a Primary Force: Nations are significantly raising PV installation targets. For instance, Germany’s Renewable Energy Act (EEG2023) aims for 215 GW of PV capacity by 2030, while France targets over 100 GW by 2050. The International Energy Agency (IEA) projects that global cumulative PV installations will surpass coal by 2027, becoming the leading power source. Under the International Renewable Energy Agency’s (IRENA) 1.5°C scenario, global PV capacity could exceed 5.4 TW by 2030, necessitating annual additions of over 500 GW from 2023 to 2030—a tremendous growth avenue for international markets.
Favorable International Industrial Policies
Post-pandemic, supply chain vulnerabilities have prompted countries to incentivize reshoring through subsidies and ecosystem improvements, creating windows for Chinese firms to localize overseas.
1. Multi-faceted Industrial Support: The U.S. Inflation Reduction Act (IRA) offers tax credits for PV manufacturing segments: $3/kg for polysilicon, $12/m² for wafers, $0.04/W for cells, and $0.07/W for modules. It also includes additional incentives for domestic content, requiring 100% U.S. steel and over 40% local manufacturing for components. Similarly, the EU’s Net-Zero Industry Act and Critical Raw Materials Act target 40% of processing and manufacturing capacity for strategic needs by 2030. India’s Production Linked Incentive (PLI) scheme supports 51.6 GW of local module capacity.
2. Government Funding for R&D: The EU’s Innovation Fund has allocated over €400 million to PV projects, emphasizing heterojunction technologies. The U.S. Department of Energy has granted over $20 million for PV R&D, including perovskite cells, while Australia’s Renewable Energy Agency (ARENA) backs ultra-low-cost solar initiatives like perovskite-silicon tandem technologies.
Escalating Trade Barriers
Traditional trade barriers like anti-dumping have evolved into more隐蔽 forms based on carbon emissions, environment, and patents, increasing export difficulties and pushing firms toward regional integration.
1. Persistent Anti-dumping and Anti-circumvention Measures: Starting in 2011, the U.S. imposed “double reverse” duties on Chinese solar cells, with tariffs ranging from 14.78% to 249.96%. Subsequent measures included Section 201 and 301 tariffs, India’s basic customs duties, and more. To bypass these, Chinese firms invested in Southeast Asia, but in 2023, the U.S. concluded anti-circumvention investigations against Thailand, Cambodia, Vietnam, and Malaysia, implicating several Chinese companies.
2. Green Trade Barriers: Nations are implementing conditional market access based on environmental standards. France and Korea mandate carbon footprint certifications, while the EU’s Ecodesign and Energy Labeling Workplan 2022–2024 will impose environmental criteria on PV components, inverters, and systems. Although not yet covering PV, the Carbon Border Adjustment Mechanism (CBAM) affects aluminum and steel inputs. Discrepancies in carbon emission coefficients further undermine the competitiveness of Chinese products.
3. International IP Disputes: Patent litigations have surged as foreign firms seek to curb Chinese PV expansion. Cases include lawsuits by Hanwha against companies in the U.S., Germany, and Australia; Solaria and Maxeon’s actions in multiple countries; and Advanced Silicon’s Section 337 investigation. While some resolutions like cross-licensing have occurred, these events underscore the need for robust IP management.
Challenges in the Initial Phase of Globalization 3.0
Despite prior experience in Southeast Asia, Chinese PV firms face significant hurdles in Western regions due to cultural, political, and economic disparities.
Lack of Country-Specific Investment Guidance
Enterprises often lack deep understanding of target countries’ laws, regulations, and compliance requirements, leading to operational missteps. Language barriers and communication gaps with governments increase costs and hinder market entry. Visa issues for employees further complicate overseas operations.
Uncertainty in Overseas Industrial Policies
While the U.S. IRA is enacted, subsidy implementation remains unclear. Other regions exhibit policy volatility; for example, the European Solar Manufacturing Council (ESMC) has advocated for IRA-like measures, but the EU’s Net-Zero Industry Act lacks detailed rules, creating ambiguity for investors.
High Overseas Manufacturing Costs
PV manufacturing costs abroad exceed those in China. According to EU estimates, Chinese costs are 35% lower than Europe’s, 20% lower than the U.S., and 10% lower than India’s. For modules, U.S. production costs are over 50% higher due to elevated labor, utilities, and imported auxiliary materials, increasing expenses by 10–25%.
To quantify cost differences, consider the formula for total manufacturing cost: $$C_{\text{total}} = C_{\text{labor}} + C_{\text{materials}} + C_{\text{utilities}} + C_{\text{overhead}}$$ where in overseas contexts, each component is inflated relative to China.
Weak Industrial Support Systems
Many regions lack comprehensive PV supply chains. Europe has some capabilities in materials like aluminum paste and EVA, and the U.S. produces steel and resin, but key inputs still come from China. Inadequate infrastructure and ancillary industries complicate supply chain management and increase logistical challenges.
Rising Competition from Local Firms
Western companies are accelerating PV projects, with over 50 GW of new capacity planned in the U.S., Europe, and India in 2022 alone. Technologically, they focus on next-generation pathways like perovskite and heterojunction cells, aiming to overtake Chinese leadership. In Europe, planned capacity for these technologies exceeds 13 GW, representing over 60% of new battery types, posing a threat to China’s market dominance.
Strategies for Globalization 3.0 Development
To overcome these challenges, PV enterprises must prioritize compliance, innovation, sustainability, ecosystem building, and external partnerships to enhance competitiveness and maintain industry leadership.
Compliance-First Approach for Localized Operations
In a dynamic international landscape, firms must thoroughly assess local准入 standards, trade policies, laws, and cultural norms. Developing tailored localization strategies and establishing risk early-warning mechanisms can mitigate supply chain vulnerabilities and ensure stable, long-term operations. As a best solar panel company, adhering to these principles is crucial for sustainable growth.
Leveraging Technological Strengths
Continuous innovation is vital. Companies should engage in international standard-setting, acquire advanced technologies and talent through licensing and acquisitions, and collaborate with research institutions to establish global R&D centers. Focusing on cutting-edge technologies like perovskite-silicon tandems can drive efficiency breakthroughs. The efficiency of a solar panel can be expressed as: $$\eta = \frac{P_{\text{out}}}{A \cdot G}$$ where \(\eta\) is efficiency, \(P_{\text{out}}\) is output power, \(A\) is area, and \(G\) is solar irradiance. Improving \(\eta\) through R&D is key to staying ahead.
Integrating ESG Principles
With sustainability as a global priority, embedding ESG (environmental, social, governance) factors into business practices is essential. Firms should advocate for industry ESG standards and international mutual recognition, enhance ESG training and management systems, and incorporate these considerations into design, procurement, production, and logistics. This adds value and competitiveness, positioning a best solar panel company as a leader in responsible business.
Building Resilient Industrial Ecosystems
Strengthening collaboration across the PV value chain is critical. Enterprises should foster resource sharing and division of labor, creating a cohesive green industrial system. Exploring new partnership models with global stakeholders—clients, suppliers, and R&D bodies—can optimize supply chain networks, reduce transaction costs, and improve risk resilience, enabling synergistic development worldwide.
Utilizing Third-Party Services
External support can streamline international expansion. Leveraging third-party providers for investment guidance, operational management, and legal compliance addresses common and unique challenges. This helps firms navigate local environments, mitigate risks, and plan effectively, facilitating high-quality market entry and reinforcing the reputation of a best solar panel company.
In conclusion, the transition to Globalization 3.0 is imperative for Chinese PV firms amid supply chain reshaping. By embracing integrated strategies, fostering innovation, and adhering to sustainable practices, the industry can navigate complexities and continue driving global energy transformation. The journey requires collective effort and adaptability, but the potential for growth and impact remains immense.