Polysilicon production

Why the concentration exists

The modified Siemens process dominates polysilicon production. It begins with carbothermic reduction of SiO2 at approximately 2000°C, yielding metallurgical-grade silicon that is 98% pure. The Siemens route then consumes 45 to 55 kWh of electricity per kilogram of photovoltaic-grade polysilicon produced. This energy intensity, combined with trichlorosilane or silane intermediates, makes polysilicon plants capital-intensive. Construction in China takes 18 to 24 months.[13][21][12][1]

The capital intensity of the process concentrates supply among firms that can absorb multi-year construction cycles and large upfront investment. Tongwei's planned Ordos project alone involves CNY 28 billion (USD 3.9 billion) for a first phase of 200,000 tons of high-purity polysilicon. Highland Materials in Tennessee secured $256 million in 48C advanced energy project tax credits. This illustrates the scale of public subsidy required to enter the industry.[15][6]

What the evidence shows

Who supplies it

Tongwei, through its subsidiary Sichuan Yongxiang, is the world's largest polysilicon producer with annual capacity exceeding 900,000 metric tons at the end of 2024. The company's domestic market share of high-purity polysilicon exceeds 30%, ranking first in both market share and shipment volume for five consecutive years. Tongwei operates four major production bases in Leshan, Baotou, Baoshan, and Guangyuan. Electronic-grade polysilicon from Tongwei is exported to overseas markets in bulk.[18][11]

The top five polysilicon producers in 2023 were all Chinese: Yongxiang, GCL-Poly Technology, Xinte Energy, Daqo New Energy, and Asia Silicon Industry. Xinte Energy produced 198,800 metric tons of polysilicon in 2024. Asia Silicon ramped capacity from 22,000 MT to 92,000 MT, climbing from eighth to sixth rank in 2022. Hongyuan Energy reached ninth place in the global ranking.[24][18][14][3]

What it depends on, and what depends on it

Polysilicon is the purified form of silicon used as the base material for crystalline-silicon solar cells and semiconductor wafers. It requires about 2,000 tons of raw silica sand to produce one ton of highly purified silicon. The material dominates 95% of the solar panel market due to cost-effectiveness. Annual polysilicon capacity stood at around 726,300 MT at the beginning of 2022 and was expected to reach 1,179,100 MT by year-end, a 62% increase.[10][23]

Where it sits in the stack

What would break it

Several Chinese producers face supply-chain risks tied to allegations of forced labor in Xinjiang, where 40% of global polysilicon manufacturing is concentrated. Daqo, GCL-Poly, TBEA/Xinte, and East Hope have been directly implicated, while Asia Silicon sources raw materials from an implicated supplier. Only Tongwei and Inner Mongolia Dongli Photovoltaic have not been implicated in forced labor in production. This regional concentration creates exposure to disruptions from policy changes, trade restrictions, or labor compliance enforcement.[9][5]

Capacity utilization has collapsed as new Chinese supply has come online. Utilization fell from around 85% on average around 2010 to below 45% in 2025. Polysilicon prices have swung dramatically over recent years. They quadrupled over a one-year period, then fell from about CNY 170,000 per ton in early 2023 to about CNY 70,000 per ton by late 2023. Spot prices for mono-grade polysilicon recently ranged from about $16 to $26 per kilogram.[7][9][15][20]

Thin-film alternatives such as copper indium gallium selenide (CIGS) have been proposed as substitutes for silicon in solar semiconductors. The scientific community believes more tests are needed to confirm their capacities. No single-junction alternative has yet created cells with better internal efficiency than thick polysilicon cells. Laser slicing of wafers could reduce silicon waste by 20% by 2027, partially offsetting demand growth.[2][4][1]

What to watch

Tongwei's Ordos plant in Inner Mongolia is under construction. The first phase of 200,000 tons of high-purity polysilicon is expected to be completed by the end of December 2025. A separate Tongwei project in Ordos was announced on December 25, 2023. It includes an annual output of 400,000 tons of high-purity polysilicon as part of a CNY 28 billion integrated project. Tongwei's Leshan plant with 120,000 tons of capacity was scheduled to be operational in 2024.[15][22][17]

Tongwei aims to raise its cumulative high-purity crystalline silicon capacity to between 800,000 and 1,000,000 tons between 2024 and 2026. The top five polysilicon manufacturers are expected to see their combined capacity share grow from 71% in 2022 to 76% in 2026. China's share of global polysilicon production will soon reach almost 95% based on manufacturing capacity under construction. The six largest Chinese manufacturers have additional capacities of roughly 1.5 million metric tons in the pipeline for 2023 and 2024.[19][23][9][16]

Highland Materials' polysilicon site location and expected commercial operations date are yet to be announced. A proposed CHIPS investment of up to $325 million would support construction of a new manufacturing facility. The facility would be on Hemlock Semiconductor's existing campus in Hemlock, Michigan, dedicated to hyper-pure semiconductor-grade polysilicon production. The project is estimated to create nearly 180 manufacturing jobs and over 1,000 construction jobs over time.[6][8]

Related nodes

Sources

1. wifitalents.com · 2026-02-12T19:58:03
2. roperroofingandsolar.com · 2021-07-27T14:08:53
3. renewable-energy-industry.com · 2025-11-27T00:00:00
4. semiengineering.com · 2013-09-29T23:00:21
5. minespider.com · 2022-02-10T00:00:00
6. pv-magazine-usa.com · 2025-03-26T00:00:00
7. thundersaidenergy.com · 2023-10-03T05:51:45
8. nist.gov · 2024-10-21
9. iea.org · 2021
10. en.tongwei.cn · 2024-12-13
11. en.tongwei.com
12. en.tongwei.cn
13. en.wikipedia.org · 2025
14. bernreuter.com · 2022
15. yicaiglobal.com · Dec 26 2023
16. pv-magazine.com · 2022
17. yicaiglobal.com · Feb 08 2023
18. pv-magazine.com · 2024-12-31
19. synapsun.com
20. scienceinsights.org · 2025
21. pv-manufacturing.org
22. energytrend.com · 2024-09-20
23. infolink-group.com · July 29, 2022
24. energytrend.com · 2023-12-31