Shen Wan Hongyuan: Mandatory energy consumption standards for silicon materials have officially been implemented, and supply-side clean-up has entered a substantial stage
The Zhitong Finance App learned that Shen Wan Hongyuan released a research report saying that in the context of overcapacity and continued low prices in the silicon industry, the official draft standards were further tightened and exceeded market expectations, which would accelerate the forced withdrawal of backward production capacity and push the industry's supply-side clean-up into a substantial stage. Leading integrated enterprises with technological transformation capabilities and leading energy consumption levels are expected to take the lead in benefiting from the improvement in the supply and demand pattern and price restoration brought about by the clearance of production capacity, and the industry competition pattern is expected to gradually shift from intrinsic price to differentiated competition.
Shen Wan Hongyuan's main views are as follows:
incident
Recently, the official draft of the mandatory national standard “Energy Consumption Limits per Product for Silicon Polysilicon and Germanium” (GB29447-2026) was released, replacing GB 29447-2022, and will be officially implemented on January 1, 2027. Compared with the draft for solicitation of comments issued in September 2025, the energy consumption limit standards in the official draft have been completely tightened: taking the Level 3 (admission) standard as an example, the energy consumption requirement for rod-shaped silicon was raised from 6.4 kgce/kg in the draft for comments to 6.3 kgce/kg, and the silane fluidized bed method was raised from 5.0 kgce/kg to 4.6 kgce/kg; Level 1 and Level 2 standards remained unchanged.
The tightening of the official draft forms a “one efficiency, one consumption” combination constraint with the “Energy Efficiency Limits and Energy Efficiency Levels for Crystalline Silicon Photovoltaic Modules and Inverters” standard, which has previously reached the end of approval
The former defines the entry threshold from the efficiency side of terminal products; the latter tightens the red line of energy consumption at the upstream silicon production side, further consolidated the mandatory restraint network covering the entire silicon-battery-module industry chain, and the supply-side clean-up of the photovoltaic industry accelerated from the policy expectations stage to the substantive stage.
The official draft has been completely tightened compared to the draft for solicitation of comments, and nearly half of the current production capacity is under pressure to meet standards
According to industry statistics, most energy consumption levels are concentrated in the 6.3 to 6.4 kgce/kg range. Of these, the production capacity that can reach 6.4 kgce/kg accounts for about 84%, but the production capacity that can reach the official 6.3 kgce/kg entry line accounts for only about 45% of the production capacity. This means that if technological transformation is not promoted, nearly half of the existing silicon production capacity will not meet the mandatory standards implemented from 2027, and face the risk of production restrictions, discontinuation, or even withdrawal.
Risk warning: Standard implementation falls short of expectations, PV demand falls short of expectations, industry competition intensifies, and technical reform costs exceed expectations.