The tide of photovoltaic module recycling is coming, why are recycling companies "not enough" and losing money?

Author: Lin Chunting

As of 2022, China's PV module production has ranked first in the world for 15 consecutive years, and the cumulative installed capacity has ranked first in the world for 7 consecutive years. This means that PV waste module recycling may form a huge market, but the reality is somewhat awkward.

"Since the launch of the waste photovoltaic module recycling project in 2016, we have invested more than 1000 million yuan in equipment and process research and development", but the project has not been profitable since it was officially put into operation in 2021. Recently, Zhu Jie, general manager of Nantong Riyi New Environmental Protection Technology Co., Ltd. (hereinafter referred to as "Nantong Riyi Xin"), said in an interview with the first financial reporter.

There are two main reasons for this: one is the low actual capacity utilization rate, and the other is the high recovery cost. Taking production capacity as an example, the annual production capacity of the new production line in Nantong Riyi can reach 1,5 tons, but the actual output last year was less than 2000,<> tons, and the equipment was idle most of the time.

The tide of scrapping of photovoltaic modules is coming, but recycling companies are not only "not enough" but may also lose money. Why is it facing such a situation, where did those waste photovoltaic modules go?

Collect one piece and lose 10 yuan

Nantong Riyi's new waste PV module recycling project chose to put into operation in 2021 due to the imminent retirement of some PV modules.

China's photovoltaic market started around 2000, and the service life of photovoltaic modules is generally 20 to 25 years, that is, some modules have reached the replacement period. In 2022, the "Renewable Energy Zero Waste Future: Research on the Development of Wind Power and Photovoltaic Recycling Industry" (hereinafter referred to as the "Research") co-authored by the Renewable Energy Professional Committee of the China Circular Economy Association, the Research and Development Center of the Chinese Academy of Environmental Sciences, the Photovoltaic Special Committee of the China Green Supply Chain Alliance, the Zero Carbon Research Institute, and the China Material Recycling Association (hereinafter referred to as the "Research") said that with the rapid replacement of photovoltaic module products, a considerable part of the first batch of solar panels currently installed has been decommissioned.

Forecasts from the International Energy Agency show that China will face the need to recycle 2030.150 million tonnes of PV modules in 1200. This is equivalent to 50,<> China-Europe trains loaded with <> <>-foot containers.

Li Dan, executive secretary general of the Renewable Energy Professional Committee of the China Circular Economy Association, previously said that the photovoltaic industry now has the demand for "cage for bird", such as module efficiency in 2010 and today's module efficiency is far from the same, especially in areas with good lighting conditions and high power generation, the need for replacement is greater.

Hu Esheng, director of the China Photovoltaic Industry Association and marketing director of Guangdong Five Star Solar Energy Co., Ltd., said in an interview with the first financial reporter that according to China's "30 carbon peak, 60 carbon neutral" goals, the proportion of non-fossil energy in primary energy will increase from 2030% to 20% in 25, and the cumulative installed capacity of wind power and photovoltaic power generation will reach more than 12.<> billion kilowatts. But the industry generally believes that the target will be achieved two years ahead of schedule.

In the view of Hu Esheng and other industry insiders, with the technological transformation of large-scale existing projects in recent years, the peak of photovoltaic module recycling will come ahead of schedule. They point out that as technology continues to advance, lower-cost and more efficient PV modules will replace previous equipment, and the actual data of end-of-life PV modules is more than predicted by the above-mentioned institutions.

For Zhu Jie, the waste photovoltaic module recycling market had a good time. He told the first financial reporter that before 2021, photovoltaic power plants and photovoltaic module manufacturers will pay waste photovoltaic module recycling merchants to deal with waste photovoltaic modules based on environmental protection and other needs. But after entering 2021, the situation began to reverse, and the latter paid the former when acquiring old PV modules.

This shift is related to the increasing number of participants. "Some small workshops flock to the market when they see that the market is profitable." Zhu Jie said, "The market is now chaotic, not only raising prices from each other, but also hoarding goods, waiting for the technology to mature before processing, resulting in very high prices, which greatly affects the healthy competition in the industry." Formal enterprises need to be mass-produced and verified by sufficient quantities of components to further optimize equipment and processes, and the current situation is rice-free, and the project is stagnant. ”

Taking 250 watts of photovoltaic modules as an example, the current recycling price of Nantong Riyixin is basically 15 yuan / piece ~ 50 yuan / block, and the price is related to factors such as transportation distance.

The first financial reporter's investigation found that the recycling of waste photovoltaic modules is currently concentrated in the hands of small and micro enterprises and individual households (known as "small workshops" in the industry), who build recycling networks on platforms such as Xianyu, Douyin, Taobao, and WeChat to obtain profits by reselling waste photovoltaic modules.

The first financial reporter used the identity of customers to contact a number of waste photovoltaic module buyers (middlemen) on platforms such as Xianyu and Douyin, and they have expressed their willingness to recycle waste photovoltaic modules at a price more than 20% higher than that of formal enterprises. "If the volume is large, the price can be further negotiated (higher)." Some of them said.

In the face of the small workshop "grabbing food", Zhu Jie lamented that the "regular army" was basically not competitive. He explained that since small workshops do not need to environmentally treat waste photovoltaic modules, the higher purchase price given is more attractive to customers.

In this case, the profits of formal enterprises recycling waste photovoltaic modules are difficult to cover the related costs of transportation, dismantling and recycling, and environmental protection. At present, the economics of photovoltaic recycling are not ideal. Zhu Jie calculated an account to the first financial reporter: the income from recycling a piece of waste photovoltaic modules is 74 yuan ~ 95 yuan, but due to the rise in procurement costs, coupled with logistics costs, the recycling cost rises to 80 yuan ~ 110 yuan, and the average loss is more than 10 yuan per piece recycled.

This is the reason why the Nantong Riyi new waste photovoltaic module recycling project has not yet achieved profitability when it was put into operation.

Where did it go

"Most of the waste PV modules are collected by small workshops." Zhu Jie said.

Zhu Jie witnessed the process of recycling waste photovoltaic modules in small workshops in the early days: "They simply disassemble the recycled waste modules and sell usable things such as frames and cables, and the other parts are mixed with household waste and burned." Recently, it has evolved to simply remove frames, cables, and glass, burn them separately, and then collect the residues after incineration for further processing. He believes that this not only causes serious pollution to the environment, but also leads to the expulsion of good money by bad money.

Photovoltaic modules are the core of photovoltaic power stations, mainly composed of glass, backplane, battery, aluminum frame, EVA, brazing strip and junction box, etc., most of the materials of each component, such as glass, copper, aluminum, silicon, silver, gallium, indium, etc. can be recycled.

The recycling process of waste PV modules is that the recyclers first transport the PV modules to the processing plant, then separate the valuable materials of the PV modules (glass, metal and their compounds, etc.), and finally purify and refine the recyclables by material manufacturers such as downstream metal refining companies and re-enter the market.

Data show that crystalline silicon photovoltaic modules in glass, steel, aluminum and semiconductor materials can account for more than 90%, in addition to about 1% of silver and other precious metals. If the retired PV modules were fully recycled, 2030.145 million tonnes of carbon steel, 110.54 million tonnes of glass, 26,17 tonnes of plastics, 5,550 tonnes of aluminum, <>,<> tonnes of copper, <>,<> tonnes of silicon and <> tonnes of silver could be obtained by <>. These materials have a wide range of applications in other cutting-edge technology fields.

Reasonable recycling and reuse of photovoltaic modules is not only conducive to saving resources, reducing the exploitation of primary resources, but also bringing considerable economic returns. The industry predicts that by 2030, the cumulative value of raw materials obtained through photovoltaic module recycling technology will be nearly 80 billion yuan, and by 2040, the cumulative recyclable value will be as high as 1100 billion yuan.

However, in reality, after the waste photovoltaic modules are taken away by small workshops, they finally cause pollution to the environment because they do not take corresponding environmental protection treatment. The first financial reporter learned that the waste photovoltaic modules recycled by the acquirer still have a certain power generation capacity, and will generally be resold to Africa, the Middle East and other places for secondary use in the form of trade. For photovoltaic modules that no longer have power generation capacity but have a well-preserved surface, they will be sold to customers with special needs, such as sunrooms, canopies, carports, etc.

For completely scrapped photovoltaic modules, some of them remove aluminum alloy frames, cables and junction boxes, separate and screen glass, metal, etc. and sell them to relevant manufacturers for reuse; Some are just the aluminum alloy frame that is the easiest to disassemble and the easiest to realize in the assembly and sell.

When asked by a reporter what to do with the remaining components, one acquirer bluntly said, "Bury it." ”

In a way, small workshops are more like "guerrillas". Zhu Jie told reporters that in recent years, the main agglomeration of waste photovoltaic module small workshops has been changing, initially in Shandong, later in Zhejiang, and now in Henan and other places.

"They don't have a fixed workplace." Wang Tongtong, president of the Zero Carbon Research Institute, told the first financial reporter that in order to do experiments, the institute had purchased second-hand photovoltaic modules from some middlemen and small workshops, "small workshops mostly adopt traditional methods when refining heavy metals, without environmental protection." The institute is jointly established by Yingli Group, Hebei Tsinghua Development Research Institute and Shengzhi Investment Company, focusing on technical research on clean energy, green buildings, zero-carbon transportation, resource recycling and reuse.

Up to now, there is no special policy for the recycling of waste photovoltaic modules in China, and relevant policies characterize waste photovoltaic modules as general solid waste. Zhu Jie told the first financial reporter that when he communicated with relevant local departments, he found that local governments often "suffer from being unable to follow" when cracking down on small workshops "illegally" disposing of waste photovoltaic modules.

In addition to small workshops, the study shows that due to the lack of policy guidance, most power generation companies retire PV modules or pile them up or burn them to bury. Heavy metal elements such as silver and copper contained in photovoltaic modules will gradually leak into the soil through physical and chemical effects, and then cause harm and pollution to environmental media such as soil and groundwater and ecological elements such as vegetation and animals, until they endanger human life and health through biological enrichment.

In addition, waste photovoltaic panels will release toxic gases such as sulfur dioxide, hydrogen fluoride, and hydrogen cyanide during incineration. These harmful gases have a stimulating effect on the human respiratory system, and long-term inhalation may cause poisoning or cancer, which is harmful to the liver, kidneys and heart. Among them, fluorocarbons have an unusually strong chemical structure, and ordinary burial treatment methods cannot degrade this component for 1000,<> years.

However, due to the late start of the domestic waste photovoltaic module recycling industry, limited R&D investment, and technology to be improved, it is still difficult to collect precious metals in the form of complex alloys in photovoltaic modules. "EVA film in components is the most difficult to handle." Zhu Jie gave an example to the first financial reporter. By processing back to EVA film, high-purity silicon and high-value metal materials can be recovered, but a large amount of organic and inorganic acids and alkali waste liquid will also be generated, which is more polluting to the environment.

How to solve a problem

When talking about the current insufficient production of Nantong Riyixin, Zhu Jie told the first financial reporter that in addition to the small workshop "grabbing food", waste photovoltaic modules are too scattered and difficult to concentrate is also one of the important reasons. For recyclers, how to obtain more sources is a big challenge.

At present, distributed photovoltaic power plants, which account for about 40% of the total installed capacity of photovoltaics, are distributed on the roofs of tens of millions of buildings in various provinces and cities across the country. Similarly, centralized photovoltaic power plants, which account for about 60% of the total installed photovoltaic capacity, are basically in remote areas such as mountains, beaches and deserts.

At the same time, centralized photovoltaic power plants are mainly held by state-owned enterprises, because they are state-owned assets, how to dispose of them when decommissioning without losing state-owned assets, there is currently no clear policy, resulting in a poor process.

At a forum in April this year, Hou Guiguang, director of the comprehensive business department of the solid management center of the Ministry of Ecology and Environment, introduced that in the current scrapping and disposal process of decommissioned photovoltaic modules, it is only disposed of in accordance with general solid waste, facing problems such as insufficient top-level planning and design, difficulty in recycling and acquisition, difficulty in cross-regional mobility, and uneven technology of recycling enterprises, which directly leads to challenges in the commercialization of the recycling market of decommissioned photovoltaic modules.

Hou Guiguang also said that because of the lack of clear regulations and requirements, the technology and model in the actual recycling process have not determined a feasible plan, even if the risk can be controlled through technology, but because there is no clear regulations, they dare not apply, so the path of circulation is not smooth.

Due to the high recycling cost of waste photovoltaic modules and the small profit available, in the absence of subsidies, the enthusiasm of enterprises to participate in module recycling is not high, and the poor economy also leads to little market development momentum. "At present, there is no clear policy at the national level, there is no relevant subsidy policy, there is no relevant mandatory requirements, and now enterprises are in a wait-and-see state." Wang Tongtong told the first financial reporter that there are only a few domestic waste photovoltaic module recycling done well, these companies have their own equipment and production lines, but the production line has not yet been put into production, after all, "trial and error costs are very high."

At present, the layout of the photovoltaic module recycling market includes Yingli Group, JinkoSolar (688223.SH), TK Environmental Protection (002672.SZ) and so on. Companies such as Grammy (002340.SZ) and LONGi Green Energy (601012.SH) also said that they will start relevant technology research in a timely manner. "We are also waiting for the moment." The relevant person in charge of the above-mentioned listed company told the first financial reporter.

"When the market starts, these companies can buy technology and equipment directly." Zhu Jie told the first financial reporter.

Behind all these problems is a gap in policy standards. Zhu Jie and other respondents told the first financial reporter that at present, the industry needs relevant departments or policy guidance to divert the waste photovoltaic modules that have been produced and are being generated to formal processing enterprises to support the rapid maturity of equipment and processes of such enterprises, the rapid development of the industry, and make technical reserves in advance to cope with the upcoming wave of photovoltaic module retirement.

In January, the Ministry of Industry and Information Technology and other six departments issued the "Guiding Opinions on Promoting the Development of the Energy Electronics Industry", requiring the acceleration of the construction of a photovoltaic supply chain traceability system, emphasizing the promotion of photovoltaic module recycling technology research and development and industrial application.

Another good news is that a person familiar with the matter told the first financial reporter that the relevant departments of the state are also asking state-owned enterprises to participate in the recycling of waste photovoltaic modules, and some state-owned enterprises have begun to investigate and discuss cooperation with enterprises that layout waste photovoltaic module recycling. "The relevant departments of the state are also conducting research below, which shows that the government attaches great importance to the recycling of waste photovoltaic modules." The insider said that there should be relevant policies this year.

Hu Esheng said: "I believe that the state will introduce relevant policies, otherwise the disposal of waste photovoltaic modules will become a very difficult problem." ”