Leading Chinese manufacturer Jinko has already unveiled a number of new products at this year’s Intersolar Europe event in Munich, including its work with the Athens airport. Dimitris Varlamis, Head of Sales of South-Eastern Europe, discusses the company’s growing global footprint, and compliance with sustainability criteria.
What is Jinko’s strategy for the EU market? How would you describe the EU solar market at the moment, and what opportunities exist in this region?
The European market is in a more challenging state compared to last year. The overcapacity of modules, inverters and storage systems is a big challenge for all the key component suppliers who have entered into a market consolidation phase, with possible shake outs not only of Tier 2 and 3 players. Even amongst the Tier 1 players, there might be growing gaps in market share and financial stability.
At Jinko we have anticipated such development and have started our preparations two years ago already. The company is in a stable financial position and has established n-type tunnel oxide passivated contact (TOPCon) as the new leading mainstream technology, with excellent manufacturing cost and efficiency ratios thanks to significantly expanded integrated production capacities.
Europe is one of the most strategic core regional markets for Jinko Solar. For the last years we consistently followed a market penetration strategy, which means we heavily invested to grow our EU market share steadily. By 2024 I expect us to exceed a 20% market share in Europe. We continue to support our stable and revolving distribution business, which makes up over 50% of our total EU sales volume.
Utility-scale projects are negatively affected by higher financing costs, such as interest rates, and low electricity prices, which have a negative impact on the economic viability of projects all across Europe. Lower interest rates and the drop in key component prices will hopefully help to revive utility-scale projects, which are currently put on hold or postponed.
How did you come to deliver over one million modules to the Witznitz solar park in Germany? Do you expect future module deals to be similarly large, as Europe looks to meet its renewable power goals?
In spite of the aforementioned challenges for bigger projects we are confident about lower interest rates and lower key component costs will have a positive impact on the economic viability of projects. In many markets, and especially in Germany, project sizes are increasing and the pipeline of future utility-scale projects is growing and only waits for a better economic viability. This is critical for Europe to reach its renewable energy targets.
Our flagship project with our partner MoveOn in Witznitz in Germany is a fantastic reference project in the European and German market in particular. We are very proud about having successfully delivered on such a huge logistic challenge in a smooth and reliable way hand in hand with our local partners who trusted in and selected Jinko for its scale and organizational capabilities to plan and deliver such a mega project in a timely manner.
Do you expect smaller-scale projects, such as the one agreed with Athens International Airport, to be important in the long-term? How do you balance the need to supply products for utility-scale installations and distributed solar projects?
Given Jinko’s size, market share and market leading position it is critical for us to be well positioned in all the three market segments: residential, commercial and industrial (C&I) and utility-scale projects. All those three market segments will play a key role to reach the EUs renewable energy targets.
Personally I consider the distributed generation sales channel as even more demanding than project business, because our wholesale partners require a stable, well-planned and reliable and long-term module supply and brand positioning and do not want to substitute their brands too frequently.
For projects the market entry barriers are lower and clients sometimes decide for a 0.1 ¢/W lower price to select a lower cost module, even though such purely Capex-driven decision sometimes backfire on the investor.
Compared to the aforementioned 650MW Witznitz mega project, the Athens airport project is smaller in size, but no less demanding from a technical point of view. Projects close to airports always have to fulfil special technical and safety requirements. At the Witznitz project Jinko was chosen as a module supply partner due to its scope and capability to deliver on very big volumes; for the Athens airport the partner selection criteria were mostly technical requirements, having the right kind of module technology that meets the strict airport requirements.
How have you sought to diversify your product line? What benefits do you expect to see from developing and offering your own storage solution?
Jinko always follows a technology leadership strategy trying to drive the market and differentiate from our peers with continuous innovations. For example we launched n-type TOPCon at mass scale production last year already, which was the key driver to establish TOPCon as the new market standard to replace passivated and emitter rear contact (PERC) much faster than most industry players would have expected. Meanwhile the market is catching up and TOPCon is the leading and most competitive technology.
Our product portfolio is continuously being adapted to meet the needs and allow USPs in all different market segments, like residential, C&I and utility scale.
Certainly one of the most important strategic investments of Jinko is to take the next steps beyond modules entering the energy storage system (ESS) business. In our opinion ESS is the critical game-changer for taking renewables to the next level. Given the growing grid capacity constraints and curtailments in many countries, ESS is pivotal to allow a further growth of renewables.
Hence our new storage business is complementary to our leading market positioning in modules with good synergies across all market segments. Our ESS product portfolio covers customised solutions for both residential and C&I (Jinko Sungiga) and utility-scale (Jinko Suntera) ESS solutions.
What went into the decision to develop separate Tiger Neo series for extreme conditions, versus one with standardised sizes? Do you think the push towards standardisation of sizes will be of benefit to the industry, and what role has Jinko played in that?
A general strategic thought on this good question: There is a very thin line for a module maker to balance between as much standardisation as possible, for cost reasons, and a customisation of products to meet the segment-specific market needs as well as possible. Every ‘customisation’ leads to automatically increased manufacturing costs, which is critical especially in the current price pressure environment.
With our NEO series we have reached a pretty good balance of standardisation, which definitely is of benefit for the industry and will allow best cost competitiveness, and suitability for the different market segments and local conditions.
The great news of Intersolar is that we even take NEO to the next level by launching our brand-new NEO Green. NEO Green will be produced in completely carbon-neutral factories and consequently significantly reduce the carbon footprint of our modules. This is part of Jinko’s commitment to not only supply energy solutions that will help to reach renewable energy targets, but we will do this in a more environmentally-friendly way as a responsible company with clear commitment to stick to our RE100 targets.
How have environmental, social and governance (ESG) priorities changed in recent years? How have you sought to ensure high standards of ESG compliance with your Neo Green product line, in particular, and do you think buyers are more conscious than ever of ESG requirements, and related aspects such as traceability?
Jinko Solar remains in an industry-leading position of information transparency and integrity in relation to ESG topics. The company is committed to not only to improve product efficiency and low-carbon production operations, but also focusing on the continuous improvement of ESG management architecture. As part of the net zero journey, JinkoSolar has committed itself in near future and long-term development; Europe is one of the most important markets to address great efforts and successful practices.
To highlight, Jinko Solar has prepared for different European markets and jurisdictions applicable and competitive EPDs and carbon footprint certifications. Thanks to the advanced technology, Jinko Solar’ carbon footprint of n-type PV modules is as low as 402kgCO2/kw, according to a third-party agency.
Furthermore, at Intersolar we have presented our Neo Green series. These n-type TOPCon panels are produced in factories that were awarded the ‘Zero Carbon Factory’ certification by TÜV Rheinland for their compliance with the criteria and requirements of such certification. Jinko Solar is also the first company in the industry to be awarded with this certification for silicon ingot manufacturing, silicon wafer cutting, solar cell manufacturing and solar module manufacturing. This milestone marks a major step in the company’s journey toward its goal to promote sustainability, innovation, and environmental responsibility.
The initial 5GW capacity of Neo Green is the result of years of significant research and development work, as well as maximising the adoption of an environmentally conscious approach across its vertically-integrated supply chain, including the use of solar, hydro and wind generated electricity in its wafer, cell and module factories in Leshan, Chuxiong and Shangrao.
As part of its broader environmental efforts, in addition to its objective of reaching 100% of electricity produced from renewable sources for manufacturing and production, Jinko Solar will continue to expand the use of recycled materials and increase the use of electric trucks and liquified natural gas-powered ships. Additionally, Jinko Solar is also targeting to gradually reduce the use of plastic in its packaging.