SNEC 2026 Day 1 feedback: strong energy storage demand, AIDC emerges as a new growth driver, while the photovoltaic upstream remains dragged by supply and policy execution

Overview

This report is Jefferies' conference feedback after the first day of SNEC 2026, covering views from a Huawei ESS expert, an SMM expert, an Envision expert, as well as management of Sigenergy, DAQO New Energy, JinkoSolar, and Sungrow. The report focuses on energy storage installations, residential storage, commercial and industrial energy storage, AIDC energy storage, photovoltaic supply and demand, polysilicon prices and inventory, technology pathways, and company-level paths to earnings improvement.

Core views

The core view is that energy storage demand remains significantly stronger than the traditional photovoltaic chain, and AIDC-driven demand for highly reliable power systems, PCS, and SST may become a new growth curve. At the same time, the photovoltaic upstream still faces polysilicon oversupply, elevated inventory, uncertainty over price-law enforcement, and risks of quality deterioration. At the stock level, Sungrow benefits from its PCS, SST, and AIDC ESS capabilities; JKS benefits from high-efficiency module upgrades and strong ESS growth; DQ's improvement depends on enforcement of the price law and destocking; Sigenergy maintains a premium residential storage positioning but regional demand and subsidy changes need monitoring.

Analysis framework

The report uses a conference-notes format, combining expert interviews, company management guidance, industry supply-demand data, and valuation assumptions to form judgments on photovoltaic and energy storage demand, pricing, margins, and the order of company beneficiaries in 2026-2027.

Methodology notes

• Research methodologyExpert interviews and management meetings

  Obtain views on demand, supply, pricing, and technology pathways through exchanges with industry experts and company management during SNEC.

  This method is suitable for quickly capturing marginal changes in the industry, but conclusions depend on interviewees' assumptions and require validation through subsequent orders, prices, and policy execution.

• Industry analysisSupply-demand and inventory framework

  Compare polysilicon supply, end-market installation demand, inventory levels, and price ranges.

  The report uses monthly polysilicon supply, demand, and inventory to judge that prices remain under pressure, while also watching whether around RMB30/kg triggers restocking by wafer companies.

• Thematic analysisAIDC ESS demand chain

  High-load fluctuations at AI data centers drive demand for energy storage, PCS, and SST.

  The report believes AIDC energy storage is mainly used for grid connection, peak shaving, and load smoothing, with high-availability PCS and future SST product specifications being key competitive factors for suppliers.

• Valuation methodologyP/B, P/E, EV/EBITDA, SOTP

  Different companies use different valuation anchors: DQ uses FY26E P/B, JKS uses FY28E P/E, Sungrow uses SOTP, and Alphabet and Amazon use EV/EBITDA.

  Valuations and target prices are based on assumptions of normalized polysilicon prices, recovering module profitability, AIDC ESS growth, and company margin assumptions.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Sungrow Power Supply Co Ltd (300274 CH)

  A core beneficiary of AIDC ESS, PCS, SST, and commercial/residential energy storage.

  Strengths

  It has mature power conversion technology, full-stack in-house R&D capabilities, about a 10% price premium, and will launch SST products in 2H26 to support the customized needs of hyperscale customers such as Amazon and Google.

  Weaknesses

  4Q25 gross margin was dragged down by the recognition of large low-margin projects in Latin America, and rising lithium carbonate prices are still affecting margins on existing orders.

  Comparison

  Compared with players that rely on supply-chain procurement of components, Sungrow stands out more in power electronics and customization capabilities.

  Risks

  Lower-than-expected photovoltaic installations, slower energy storage growth, insufficient cost pass-through, and margin pressure in utility-scale ESS.

• JinkoSolar Holding Co., Ltd. (JKS US)

  A growth name in photovoltaic modules and ESS.

  Strengths

  Its upgraded 70GW high-efficiency module capacity brings about a USD1c/W premium, silver-coated copper paste can reduce costs by about RMB0.03/W, and it targets 15GWh of ESS shipments in 2026, with 80% overseas.

  Weaknesses

  Profit recovery still depends on volume ramp-up of high-efficiency modules and realization of pricing premiums in 3Q26, while the Saudi project has been delayed by policy uncertainty.

  Comparison

  The company emphasizes profitability over market share and sees ESS as a high-growth driver over the next 2-3 years.

  Risks

  ADR listing environment, upstream prices above expectations, lower-than-expected photovoltaic installations, and overseas trade barriers.

• DAQO New Energy (DQ US)

  A high-beta play on polysilicon price recovery and supply-side policy execution.

  Strengths

  Cash cost is about RMB30-32/kg; if the price law is enforced, polysilicon prices could rise to RMB40+/kg. The company also plans to enter SST, switches, and ESS to access the AIDC market.

  Weaknesses

  It is currently maintaining a 50% utilization rate while accumulating 60kt of inventory, industry inventory is as high as 400-550kt, and enforcement of the price law remains uncertain.

  Comparison

  Compared with downstream module and energy storage companies, DQ is more sensitive to polysilicon prices and inventory cycles.

  Risks

  Downstream utilization rates below expectations, lower-than-expected photovoltaic installations, failure of the price law to be implemented, and slower-than-expected exit of outdated capacity.

• Sigenergy (6656 HK)

  A residential energy storage and energy management systems company, listed in the report as NC.

  Strengths

  Growth is contributed by the Australia, EU, South Africa, and Japan markets; it maintains a 20-30% price premium versus peers and has launched Sigenstor Neo for Southeast Asia and Africa.

  Weaknesses

  Its premium positioning may limit penetration in price-sensitive markets, and demand sustainability after Australia's subsidy rollback needs to be watched.

  Comparison

  The company avoids direct price competition and maintains its premium through AI integration and product experience.

  Risks

  Regional subsidy changes, intensified competition, changes in certification thresholds, and weaker-than-expected delivery of new products.

• AIDC ESS value chain

  A new energy storage use case driven by AI data center needs for grid connection, peak shaving, load smoothing, and power quality improvement.

  Strengths

  U.S. AIDC ESS demand is expected to double to 10GWh in 2026 and reach 70-80GWh by 2030, with system availability and PCS capabilities becoming key barriers.

  Weaknesses

  It currently mainly serves grid-connected scenarios; if it shifts to off-grid scenarios, more storage capacity and more complex system design will be needed.

  Comparison

  Compared with traditional utility-scale energy storage, AIDC ESS places greater emphasis on high power, high reliability, and customization.

  Risks

  Slower-than-expected customer architecture deployment, products failing to meet specifications, excessive costs, and changes in data center power planning.

• Alphabet Inc. (GOOGL) and Amazon.com, Inc. (AMZN)

  The report discloses ratings and target prices and also mentions them as demand-side companies related to AIDC energy storage.

  Strengths

  Hyperscale data center customers may generate demand for customized power systems and ESS.

  Weaknesses

  The report's core discussion is not on their fundamentals; related content mainly comes from valuation/risk disclosure and Sungrow customer-demand scenarios.

  Comparison

  The two names are more clues to AIDC demand than the main SNEC new energy supply-side theme in this report.

  Risks

  Macro, regulation, capital expenditure, AI-related business transition, and margin pressure.

Key data

• Global ESS installations in 2026>150GWh, +80% YoYA Huawei ESS expert expects China to account for about 60% of the global total, with annual growth of about 20-30% after 2026.
• Global residential storage shipments in 202630GWh, +14% YoYThe EU accounts for about 50%, and EU residential storage demand is expected to grow 30% in 2026.
• Commercial and industrial energy storage installations in 202632GWh, +66% YoYChina accounts for about 60%, with growth driven by U.S. AIDC and China's zero-carbon industrial parks.
• Global photovoltaic installations in 2026-2027432GW in 2026, 455GW in 2027An SMM expert expects China, the EU, and the U.S. to reach 211GW, 66GW, and 40GW in 2026, and 218GW, 68GW, and 46GW in 2027, respectively.
• Polysilicon supply and demandSupply 120-130kt/month, demand about 80-90kt/monthThe SMM expert believes prices may still decline under high inventory, while RMB30/kg is a relatively low level that could trigger wafer restocking.
• Industry polysilicon inventoryAbout 400-550ktDQ management estimates that polysilicon companies hold 300-400kt and wafer companies hold 100-150kt.
• DQ operating data50% UTR, 60kt inventory, cash cost RMB30-32/kgIf the price law is enforced, polysilicon prices could rise to RMB40+/kg; if not, they may remain at RMB30-35/kg.
• Sigenergy regional guidanceAustralia 8-10GWh, EU revenue RMB6-7bnManagement said market share in South Africa is about 20-30%, and 2026 revenue in Japan is about USD100mn.
• JKS module and ESS targetsModules 75-85GW, ESS shipments 15GWhJKS expects to recognize ESS revenue on 10GWh in 2026, with 80% overseas, and targets a return to profit in 3Q26.
• Sungrow energy storage and AIDC2025 commercial and industrial plus residential storage shipments 4GWh, revenue RMB8-10bnManagement expects U.S. AIDC ESS demand to reach 10GWh in 2026 and 70-80GWh by 2030.
• Sungrow margin indicatorsResidential storage NPM about 20%, commercial and industrial plus residential storage GPM about 40-50%These businesses may partially offset margin pressure in utility-scale ESS.
• Core target pricesDQ US$31.87, JKS US$32.61, Sungrow RMB236.35The report is based on valuations of 0.5x FY26E P/B, 10x FY28E P/E, and SOTP, respectively.

Impact & implications

The investment implication is that energy storage, especially AIDC-related ESS, may become a more certain growth direction within the new energy value chain, with technical barriers concentrated in PCS high availability, SST, system integration, and customer customization capabilities. In contrast, the photovoltaic upstream still needs to wait for policy execution, inventory digestion, and price recovery. The growth drivers for Sungrow and JKS are more tied to orders and technology upgrades, while DQ depends more on whether industry supply-side constraints are truly implemented.

Risks

• Uncertainty over the pace of enforcement of the polysilicon price law and industry reform may cause price recovery to be slower than expected.
• Polysilicon supply still exceeds demand, industry inventory remains high, and prices may continue to face pressure.
• Quality deterioration upstream due to cost-cutting may trigger large-scale warranty disputes within 1-2 years.
• Subsidy rollbacks in markets such as Australia may affect the sustainability of residential storage demand.
• AIDC ESS has high requirements for PCS availability, SST, and system design; if product specifications or customer architecture deployment fall short of expectations, growth will weaken.
• Trade barriers, the ADR listing environment, regional policy changes, and delays in the Saudi project may affect overseas businesses such as JKS.
• Rising lithium carbonate prices, insufficient cost pass-through on existing orders, and recognition of low-margin projects may pressure Sungrow's margins.
• If photovoltaic installations or energy storage system growth are below expectations, the report's target-price assumptions may be difficult to achieve.

What to watch

• Progress in cost verification under the price law and industry reform, and whether it truly constrains sales below cost.
• Whether polysilicon prices can stabilize around RMB30/kg and trigger wafer restocking, or rise to RMB40+/kg after policy implementation.
• DQ's demand growth in 2H26, destocking pace, and the pace of outdated capacity exits.
• JKS's return to profitability in 3Q26, premium on high-efficiency modules, cost reduction from silver-coated copper paste, and delivery of ESS shipments.
• Sungrow's 2H26 SST product launch, AIDC customer orders, and the path of U.S. AIDC ESS demand expanding from 10GWh toward 70-80GWh by 2030.
• Sigenergy's demand resilience after Australia's subsidy rollback, guidance for EU revenue of RMB6-7bn, and delivery of Sigenstor Neo in price-sensitive markets.
• Envision/Fluence's AIDC reference architecture for the Vera Rubin NVL72 platform and potential shipments of about 1GWh in 1Q27.
• Whether lower sodium-battery costs, cycle life, and advantages in extreme temperatures can drive large-scale adoption.