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Visualizing China’s Dominance in the Solar Panel Supply Chain

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visualization of global solar pv panel manufacturing capacity by country/region.

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China’s Dominance in the Solar Panel Supply Chain

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Many governments are investing in renewable energy sources like solar power, but who controls the manufacturing of solar photovoltaic (PV) panels?

As it turns out, China owns the vast majority of the world’s solar panel supply chain, controlling at least 75% of every single key stage of solar photovoltaic panel manufacturing and processing.

This visualization shows the shares held by different countries and regions of the key stages of solar panel manufacturing, using data from the International Energy Agency (IEA).

Solar Panel Manufacturing, by Country and Stage

From polysilicon production to soldering finished solar cells and modules onto panels, China has the largest share in every stage of solar panel manufacturing.

Even back in 2010, the country made the majority of the world’s solar panels, but over the past 12 years, its average share of the solar panel supply chain has gone from 55% to 84%.

China also continues to lead in terms of investment, making up almost two-thirds of global large-scale solar investment. In the first half of 2022, the country invested $41 billion, a 173% increase from the year before.

Country/RegionSolar Panel DemandAverage Share of Solar Panel Manufacturing Capacity
China36.4%84.0%
Europe16.8%2.9%
North America17.6%2.8%
Asia-Pacific13.2%9.1%
India6.9%1.3%
Rest of the World9.1%0.8%

Source: IEA
Note: Percentages may not add up to 100% due to rounding

After China, the next leading nation in solar panel manufacturing is India, which makes up almost 3% of solar module manufacturing and 1% of cell manufacturing. To help meet the country’s goal of 280 gigawatts (GW) of installed solar power capacity by 2030 (currently 57.9 GW), in 2022 the Indian government allocated an additional $2.6 billion to its production-linked incentive scheme that supports domestic solar PV panel manufacturing.

Alongside China and India, the Asia-Pacific region also makes up significant amounts of solar panel manufacturing, especially modules and cells at 15.4% and 12.4% respectively.

While Europe and North America make up more than one-third of the global demand for solar panels, both regions make up an average of just under 3% each across all stages of actually manufacturing solar panels.

Too Little Too Late to Diversify?

China’s dominance of solar photovoltaic panel manufacturing is not the only stranglehold the country has on renewable energy infrastructure and materials.

When it comes to wind, in 2021 China built more offshore wind turbines than all other countries combined over the past five years, and the country is also the leading producer and processor of the rare earth minerals essential for the magnets that power turbine generators.

In its full report on solar panel manufacturing, the IEA emphasized the importance of distributing global solar panel manufacturing capacity. Recent unexpected manufacturing halts in China have resulted in the price of polysilicon rising to 10-year highs, revealing the world’s dependence on China for the supply of key materials.

As the world builds out its solar and wind energy capacity, will it manage to avoid repeating Europe’s mistakes of energy import overdependence when it comes to the materials and manufacturing of renewable energy infrastructure?

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Batteries

4 Benefits of LFP Batteries for EVs

LFP batteries are gaining popularity in EVs, with brands like Tesla and Ford increasingly adopting this technology due to their benefits.

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The following content is sponsored by First Phosphate

LFP Batteries for Electric Vehicles

Even though the technology behind EVs has evolved significantly over the past decade, batteries have always been a critical component. 

Lithium iron phosphate (LFP) batteries are becoming an increasingly popular choice for standard-range EVs, with major automotive producers like Tesla and Ford introducing LFP-powered vehicles into their catalog. 

In this infographic, our sponsor First Phosphate highlights the advantages of using LFP cathode batteries in EVs.

Benefit 1: Safety

LFP batteries are among the safest types of lithium-ion batteries, with a low risk of overheating and catching fire.

These batteries are less prone to thermal runaway and do not release oxygen if they catch fire, making them safer than other lithium-ion batteries.

Benefit 2: Long Life Cycle

LFP batteries have a longer lifespan than other types of lithium-ion batteries due to their low degradation rate. Meaning they can be charged quickly without significant battery damage, therefore leading to a longer lifespan.

LFP batteries can also withstand a larger number of charge and discharge cycles, meaning they can last longer before needing to be replaced.

Benefit 3: Cost-Effective

The materials used to produce LFP batteries are also relatively cheap compared to other types of lithium-ion batteries.

The main cathode materials used in LFP batteries are iron and phosphate, and they are in relative abundance in contrast to other battery metals. This makes them a cost-effective option for a variety of energy storage applications.

Benefit 4: Environmentally Sustainable

LFP batteries are environmentally sustainable because they are non-toxic and do not contain harmful heavy metals such as cobalt or nickel.

The materials used in these batteries are easier to source ethically, which makes them a more sustainable option than other types of lithium-ion batteries.

What’s Inside the Battery?

Most EVs utilize battery packs consisting of multiple individual battery cells. Similar to other types of lithium-ion batteries, LFP battery cells are made up of several components.

Cathode43%
Anode31%
Electrolyte20%
Cell Container4%
Separator2%

The cathode is the battery’s positive electrode and impacts its performance. It determines aspects such as energy capacity, charging and discharging speed, and the risk of combustion.

In LFP batteries, the cathode composition consists of three elements.

Phosphate 61%
Iron35%
Lithium 4%

Today, these batteries are becoming increasingly popular in standard-range EV models. LFP market share has significantly increased, reaching its highest share in the past decade at 30% of the market in 2022, according to the International Energy Agency (IEA).

First Phosphate is a mineral development company fully dedicated to extracting and purifying phosphate for the production of cathode active material for the LFP battery industry.

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