The International Renewable Energy Agency (IRENA) stated in its latest report that while China remains the global leader in the photovoltaic supply chain, Vietnam has emerged as the lowest-cost manufacturing location outside of China, with production costs that can even rival those within China itself.
The report indicates that the total cost of TOPCon modules manufactured in Vietnam in 2025 is $0.180/W, and it is expected to further decrease to $0.171/W by 2030. For comparison, the cost of fully domestically manufactured modules in India is currently $0.191/W, while costs in Australia and Germany are as high as $0.256/W and $0.284/W, respectively.
Vietnam’s competitive advantage is mainly attributed to favorable government policies, low labor costs, and electricity tariffs. Furthermore, Vietnam is one of the few Asian countries with a complete photovoltaic supply chain. In contrast, Germany’s high electricity, labor, and construction costs, coupled with limited economies of scale, constrain its manufacturing economics.
IRENA’s analysis points out that electricity consumption and silver paste usage are the main cost drivers in PV manufacturing. The report forecasts that between 2025 and 2030, electricity consumption in the polysilicon and wafer stages will decrease by 6%, by 25% in the cell stage, and by 20% in the module stage. Simultaneously, through technological innovation, silver consumption is also expected to drop by 25%.
The report also reveals the cost-reduction potential of a “hybrid strategy.” Taking Vietnam as an example, if imported cells are used for module assembly, the total cost could be reduced from $0.180/W to $0.124/W, a decrease of 31%; if Chinese-made wafers are used, the cost could drop to $0.146/W. Analysts believe that the final price of a module highly depends on whether key components are imported or manufactured locally.
Regarding the sustainability of manufacturing, IRENA suggests that governments adopt intervention measures, including providing industrial preferential electricity tariffs, encouraging self-generation and self-consumption, and supporting low-cost energy through Power Purchase Agreements (PPAs). Additionally, the report calls for the establishment of mechanisms similar to India’s Production Linked Incentive (PLI) scheme, along with strict national quality standards and certified manufacturer lists, to enhance project bankability and promote exports.
