Thailand becoming leader in solar module assembly

A radical shift in where solar modules are assembled has seen Thailand emerges as leader in the global industry and the country can expect more gains in market share during the next two years, according to an analysis published last week by a solar power industry media organization.

“Third-party module supply by original equipment manufacturers (OEMs) has moved firmly to Thailand, with continued market-share gains expected going forward,’’ wrote Finlay Colville for the Pvtech.org website, which described him as a leading authority on the solar PV industry and an author of hundreds of technical articles and blogs.

The transitional stage of the Thai economy makes it the perfect place for solar cell manufacturing at this point in time because the skill levels of Thai workers are relatively high while their wages are still in an affordable range. Solar cell manufacturing requires low labor costs to be competitive and is often chasing after cheap labor locations, Colville wrote. Although there are countries near Thailand that have cheaper labor, their lower levels of development at this time means their workforces are in general less skilled.

“Within Thailand, it is important to define clearly who is operating the sites. Thailand has a greater number of OEM players whose business model has more of a sub-contract element to it, with the customers often being Chinese companies who bankroll the efforts,” Colville wrote.

Thailand, which is seeking to increase its own use of renewable energies and transform its economy into one that relies more on higher and green technologies, has been rolling out the welcome mat for solar cell manufacturers. The shift towards higher and green technologies is part of the Thailand 4.0 policy.

The Board of Investment (BOI) gives solar cell manufacturers its maximum incentive of an eight-year income tax holiday. A requirement for setting up a joint venture or Thai-owned solar cell manufacturing facility is that materials are developed locally.

“Thailand is making some cutting-edge advancements in solar cell research, making it a leader in Asia. Its latest thin-film amorphous silicon solar-cell technology pioneered by the TMC can convert 15 percent of solar power into electricity, higher than most other amorphous silicon solar cell systems on the market, which can manage only around 8 percent. The higher the ratio, the better is the cost effectiveness,” said Porponth Sichanugrist, director of the Technology Management Center at the National Science and Technology Development Agency (NSTDA).

“Since solar cell manufacturing is using a high level of technology, it’s good for Thailand’s competitiveness and sustainable growth, and it could become an important export in the future,” he added.