March 23 – 2015 VILLA LAZZARONI - ROME Lourens Vermaak Sales Manager – Southern Africa Jinko Solar PTY LTD South Africa
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THE PV GAME – ENEL ROUND TABLE March 23 – 2015 VILLA LAZZARONI - ROME
Lourens Vermaak
Sales Manager – Southern Africa
Jinko Solar PTY LTD
South Africa
Jinko Solar’s production Facility – Case Study on logistics
Source: DoE presentation: Round 4 preferred bidders
South African Economy vs Logistics Industry
Government policies supports demand rather than Local Production. 20 years - Economy reliant on consumption expenditure. Demand-supply Imbalance. The business sector had to cope with:
Constant service tariffs rising Volatility in the financial markets Strikes / wage settlements. The abrupt cut in tariff protection following the 1994 election.
Highly transport intensive economic setup. Transport hungry country has a far higher landing cost. Less attractive environment in which to do business.
Logistics Industry – Infrastructure
470Billion Rand Industry that has: Total Railway network: 30 422km’s Track
20 101km’s Route Core Railway network: 12 801 km Proclaimed roads of approximately 535 000 km
366 872 km non-urban roads. +/-300 000 km gravel roads.
Eight commercial ports Durban/CPT/PE – Main Ports Airports Durban/CPT/Johannesburg
Total Logistics Cost
Fuel costs most significant and volatile cost driver – Total Cost. Crude oil prices coupled with Exchange Rate.
Fourth highest supply chain constraint.
Skills Shortage Breakdown
Industry status
Source: DoE presentation: Round 4 preferred bidders
Industry that has moved beyond survival mode to optimised mode where costs, inventories and lead times have been minimised.
Growth and Performance Influencers vs. Action Plan
Source: DoE presentation: Round 4 preferred bidders
Direct Impact on costing influenced by: Exchange Rate Inflation Rate Interest Rate
Macroeconomic influencers: Structure of the South African economy. Balance of payments Budget deficits
Performance influencers: Trends in South African supply chains Critical logistics enablers Transport efficiency Human Resource
Gov. & DTI’s action plan: National Development Plan, the Industrial Policy Action Plan and a number of
initiatives.
Jinko Solar production Facility
Global Company Overview
Established in 2006, Listed in NYSE: May.2010 (NYSE: JKS) Vertically integrated with 2.5-3 GW capacity across the value chain Over 10 GW of modules deployed in the projects worldwide 23 sales offices, 13,000 employees worldwide Downstream business: 500 MW complete, to reach 800 MW by 2015 1,6 Bln in revenues, China Fortune 500 Company The 3rd largest crystalline module manufacturer globally
2nd in the Photon Module Test 4th in the PWC’s PV Sustainable Growth Index Tier 1 Global PV Company rated by Bloomberg Finance, 65 Banks
worldwide providing project financing for Jinko technology
Market Value
Silicone Module Cell Wafer Ingot EPC
Core Business
Company Overview
Industry Leader
Milestones
2013 2013
Jinko Solar Co., Ltd. established
Acquiring Sun Valley (cell & module manufacturer)
Operating the 1st fully automated PV module NPC production line in China
Successful IPO and listed in NYSE
German Office & USA Office Launched
Reaching 1 GW Capacity
Swiss & French & Italy Office launched Beijing Office launched
Sponsorship of Valencia C. F., San Francisco 49ers, Germany DFB stadium
2006 2007 2008 2009 2010 2011 2012
Reaching 3.2 GW Capacity
Chilean Office & 2nd Japan Office launched
Launching ingot manufacturing
Acquiring Sun Valley (cell & module manufacturer)
South Africa & Portugal Factory In operation
2014 2013
Bid Window 1 – Kathu Northern Cape
81MW PV Modules Module Type JKM-250P-60 324000 modules 12960 Pallets 589 Containers Inbound. Delivery window – February 2013 – October 2013 = 9months 66 Containers a month. From port to Site = 1078 km’s Total Km’s travelled = 1 270 000Km
Bid Window 1 – Linde, South Africa
40MW PV Modules Module Type JKM-290P-72 137950 modules 5518 Pallets 251 Containers Inbound. Delivery window – February 2013 – October 2013 = 9months 27 Containers a month. From port to Site = 780 km’s Total Km’s travelled = 391 560 Km
Bid Window 2 – Dreunberg, South Africa
75MW PV Modules Module Type JKM-295P-72 254250 modules 10170 Pallets 463 Containers Inbound. Delivery window – September 2013 – June 2014 = 9months 51 Containers a month. From port to Site = 920 km’s Total Km’s travelled = 851 920 Km
Bid Window 2 – Sishen, South Africa
95MW PV Modules Module Type JKM-295P-72 308475 modules 12339 Pallets 561 Containers Inbound. Delivery window – September 2013 – June 2014 = 9months 62 Containers a month. From port to Site = 1100 km’s Total Km’s travelled = 1 234 200 Km
Global Footprint
Headquartered in San Francisco (USA)
Ontario office (Canada)
Munich office (Germany)
Swiss Office European Warehouses
Bologna office (Italy)
Queensland Office (Australia)
Singapore office (APAC HQ)
India office
Thailand office
Tokyo & Osaka office (Japan)
Santiago office (Chile)
Sao Paolo office (Brazil)
South Africa factory
Portugal Factory
Beijing office (China)
Guangzhou office
Jinko Solar PTY LTD – South Africa
South Africa factory
Milestones
2013 2013 2012 2013 2014
• Jinko Solar PTY LTD Registered.
• First Production Equipment arrived Q4 2012
Final Production equipment arrived Q4 2013
Factory setup started Jan 2014 First Module produced April 2014
Company Profile
The only Tier 1 Solar Module Manufacturer in South Africa.
Capacity:
120MW Solar Module production Plant
245 local Employees.
Level 4 BBBEE contributor.
Listed on IDC’s preferred list of suppliers.
Local content offer of up 33%
Integrated Supply-Chain
Jinko Solar PTY LTD has a fully integrated supply-chain. End-to-End user integration.
PMC creates Job and
issues Job Card Customer
order received.
Procurement
Raw Material
Warehouse
FQC ProductionI
IPQC
FQC
Finished Goods/ Dispatch
End User
Supply-Chain: Raw Material Warehouse
Current Operation.
Fully Functional Rebate/Customs controlled Warehouse.
IQC done on all incoming products.
Average turn around time of 20min per container when receiving goods.
Minimum stock level of 3MW.
Total Capacity of 10MW per product line.
Full traceability throughout the complete product line.
100% FIFO compliant
ISO and TUV Certified
Supply-Chain: Raw Material Warehouse
Process Flow
Inbound/ Customs
Clearance
Receipt of Stock/IQC
Stock labelled/ stored – FiFo/BOE
Records updated
Inbound process flow
BOM Receipt
Picking Handover to production
Records updated
Outbound process flow
Supply-Chain - Factors to consider:
Rebate Application: Challenge:
Application Delays.
Possible issues: Duty payments or bonded Facility charges.
Solution: Allow Approximately 120 days for application process
Staff skills: Challenge:
Complex warehousing. Higher skilled staff required.
Possible Issue: Penalties and possible revoke of licence.
Solution: Training available through external parties. Inhouse-training program.
Supply-Chain: Production Facility
Current Operation
Three shift system, operating 24/7 - Daily production of +/- 0.325MW
4 x stringers with a total of 8 line output.
Line output of 600 cells per hour.
EL testing done at pre and post lamination.
Total of six Laminators laminating on average 83 modules per hour.
Fully automated framing table ensuring an output of a 100 modules per hour.
IV Flash done: 1000W/m² - 25 degree Celsius - AM=1.5
Supply-Chain: Production Process Flow
Pre-lamination
Lamination Post
Lamination Final QC
EL Test Pre/Post lamination
Outbound Finished Goods
Supply Chain: Quality Control
EMS- Electronic Management System
16 in-line quality control points in module workshop {IQC/IPQC(Pre/post Lam)/FQC/OQC/OBI}.
Precise data-recording & supervision for all the manufacturing QC points
Product Traceability Control Tracking card with unique barcodes tracing from module back to ingot Long term data accessibility
Production Facility - Factors to consider:
Staff Transport: Challenge:
Geographical position VS Skills availability.
Possible issues: High staff Transport transport cost.
Solution: Allow enough time for an in-depth recruitment process.
Supply Chain: Finished Goods warehouse
Current operation.
Fully Functional Finished Goods Warehouse.
Storage Capacity of 30Mwatt.
Loading Capacity of 12 x 40’’ containers per day.
Loading Capacity of 15 Super-Link Trucks per day.
ISO + TUV certified.
Ability to deliver first modules within 48 hours after receipt of release.
100% FIFO compliant.
Supply Chain: Finished Goods Warehouse
Process Flow
Receipt from Production + quality Check
Loading Container
Truck
Stored
Finalise Documents
Update Records
Update Records
OBI – Quality
Support Structure – Local Projects
Source: DoE presentation: Round 4 preferred bidders
Road Map – Renewable Program.
Product line
Packaging: • 25 unit per Pallet • 28 pallets per container • 40 pallets per Inter-link truck • 505Kg Per Pallet
Packaging: • 25 unit per Pallet • 22 pallets per container • 36 pallets per Inter-link truck • 708Kg Per Pallet
JKM295-310P-72 JKM245-265P-60
Project Supply Costing
Transport
Mode
Project Size
Module Type Transport Method
Total Transport cost
Project Savings in ZAR
12m CPT (R19000.00) 75MW JKM-295P-72
CPT Harbour direct to Site R 8 797 000 R 0
18mCPT (R21000.00) 75MW JKM-295P-72 CPT break-bulk to Site R 8 383 800 R 413 200
18mCPT (R21000.00) 75MW JKM-295P-72
Ex-works South African factory R 5 943 000 R 2 854 000
Transport to site: 75MW = 10170 Pallets
Containerized x 463 loads
Beak bulk x 283 loads
Supply Chain - Factors to consider:
Volume based Inventory: Challenge:
60 Cell pallets dimensions – 1.70mx1.1mx1.1m 72 Cells pallet dimensions – 2.0mx1.1mx1.1m
Possible issues: Storage, staff and transport costs.
Solution: Catered storage space/External storage.
Summary
Summary:
Past economical setup – limited the success rate of the logistics Industry.
Globally competitiveness S.A. Industries. Government and DTI – Initiative – Increase production output. Change the underlying structure of the economy. Local Production allows supply chain integrations - Unlocking
transport efficiency. End-to-end visibility enables real time decision making. Local Production supports – Critical enablers. Skills development though exposure to international standards. Drives down total logistics cost - Build an economy – Better exchange
rate - Lower the demand – Increase sustainability.
References:
CSIR – “State of logistics” – Survey for south Africa University of Stellenbosch – Department of logistics Jinko Solar PTY LTD – Management www.energy.org.za
www.jinkosolar.com
Lourens Vermaak
Sales Manager – Southern Africa
Mobile: +2783 259 7613
Office: +27 21 534 3467
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