Chapter 368: A Consideration For Profit Maximization
“Thank you all for your full cooperation. We have successfully found the right path. The next steps will be handed over to the industry.
This is not my personal victory; it is the contribution of everyone present.
Afterward, I will contact Nature or Science official to publish our achievement this time as a special issue, and everyone will be listed as authors on it.
The authorship will not distinguish order; it will be sorted by surname.”
Lin Ran said with a smile.
Everyone spent an entire spring here, without going back for the New Year, only reporting safety through telephone.
In Lin Ran’s view, paper authorship is just the basic reward after passing this level.
It is also what he can do. As for advanced rewards, it depends on how the national level allocates them.
A scholar in the audience raised his hand and asked: “Professor, shouldn’t this be kept secret? If we publicize our achievement, won’t that give foreign countries a chance to catch up?”
Lin Ran explained: “Of course, we are only publishing the principle, the mathematical level breakthrough, from mathematics to the experimental end, the breakthrough in experimental data, telling the outside world how we saw the path to photovoltaic module breakthrough from mathematics, and then how we followed this path to the end.
We are only publishing these.
As for the path from laboratory modules to industrial production, this can be seen as pioneering. We have blazed a new road in the wilderness, and this new road can allow cars to pass smoothly on it.
This new road will not be published.”
Technological breakthrough is not that simple. They have indeed achieved industrial mass production, but only theoretically, finding a path. Following this path and according to this proposal, you can achieve industrial mass production.
Such industrial mass production can theoretically guarantee yield rate, reliability, and cost.
But theory is theory, and reality is reality.
In reality, the production end will still encounter various problems during large-scale production processes.
It requires adjustments to existing production lines, use of some new materials, and re-honing of processes; all these are costs.
At the beginning, it is also hard to achieve the theoretical cost; it still needs honing.
And when the technology is distributed to different large photovoltaic factories, everyone will also derive different production process details.
Longi, Tongwei, Jinko—these will definitely not have identical processes.
Technological breakthrough is just the first step, industry honing is the second step, Popularization of sales end is the third step, and then this will form a cycle.
Process adjustment optimization, Sales end popularization, user end feedback, laboratory adjustment—this cycles back and forth, and the entire process gradually matures, then completely replaces the old production lines.
It is not that as soon as Lin Ran’s technology breaks through, the production end can immediately achieve large-scale replacement.
This is just completing the first step of rolling the snowball.
“Professor, but once they know the principle, the industrial end mass production process, foreign countries can easily break through.” Another scholar raised his doubt.
Lin Ran nodded: “That’s right, but the problem is, as long as we are to carry out large-scale production, as long as we deliver the technology to enterprises, can the secret be kept?
Large-scale mass production, technology secrecy, and technology participants themselves form an impossible triangle.
No technology can achieve all three at the same time.
We must have confidence in China’s photovoltaic industry. With the involution king level of China’s photovoltaic industry, even if foreign countries know, they cannot catch up.”
Photovoltaics definitely
In the early days, America was the main player in the photovoltaic industry, with technology originating from America, and America dominated the research and development and manufacturing of the photovoltaic industry throughout the 1990s.
China entered the industry late, but relying on subsidies, industrial vertical integration, and supply chain dominance, it quickly achieved a reversal and surpassed others.
Subsidies are just one aspect; Europe also has subsidies. Germany relied on the Renewable Energy Act to introduce feed-in tariff subsidies, driving Europe’s photovoltaic installation capacity from less than 1GW in 2000 to about 30GW in 2010.
America then subsidizes the photovoltaic industry through policies such as investment tax credits and the California solar initiative.
Subsidies are just one aspect; the full integration of technology and supply chain, along with the government’s long-term firm investment in photovoltaics, are the more important parts.
Everyone present can be considered industry insiders. Although you may not have necessarily received lateral projects from enterprises, you are all quite clear about the development of China’s photovoltaic industry.
They are very clear that if competing in a fair environment, China’s photovoltaic companies will definitely be able to outperform those in Europe and America.
Of course, this involves the degree of involution.
China’s engineers really can do it, staying in the factory for technology breakthroughs, operating under overload to do process adjustment, problem collection feedback, and production end assistance.
In China, involution is chain-like. Throughout the entire supply chain, from upstream to downstream, workers, engineers, and R&D personnel, none of them are not involuted.
Why can’t Europe and America compete, always accusing you of unfair competition? Because their problem feedback takes half a year to resolve leisurely, while in China, if a problem feedback isn’t solved in three days, the engineers directly come to the factory for on-site debugging.
There is an essential difference in efficiency between them.
Researchers also stay in the laboratory, and working overtime is commonplace.
“Professor, Yanjing side has passed the achievement acceptance. This is the main person in charge from Yanjing’s new energy and renewable energy department. He will personally discuss the follow-up cooperation details with you.”
Song Nanping brought in a middle-aged man wearing a black jacket, and after Lin Ran nodded, he left him in Lin Ran’s office.
“Mister Lin, my name is Wan Song, representing the Yanjing side, to personally thank you for your contribution. You not only solved a major difficult problem for us, but also provided a new outlet for our current dilemma of having money but nowhere to spend it.”
Song Nanping said during the introduction that he had understated Wan Song’s level.
“Meanwhile, our colleagues in the finance line have made a killing during this period. The seed funding for the new central state-owned enterprise was directly raised from the Americans’ capital market.”
Wan Song continued, “Including after the continuous penetration of new energy vehicles, some comrades’ doubts about the power grid’s load-bearing capacity have also been dispelled.”
This refers to the ongoing voice that the increase in New Energy Vehicle holdings will place an unbearable load on urban power grids.
This problem can of course be solved through power grid modification and upgrades, but similarly, you are essentially still increasing the demand for electricity. With China’s current power generation method mainly based on burning coal, the air pollution problem still cannot be solved.
The emergence of new Photovoltaic modules has given the Chinese side a better solution idea.
Lin Ran said without thinking: “This is what I should do anyway. I have always held a viewpoint that the country is my best partner.”
Behind this, there are certainly factors of patriotism, family and country sentiments, and considerations of greater ability meaning greater responsibility, but there are even more realistic factors.
Simply put, taking the financial capital operations associated with this Photovoltaics technology revolution as an example, how much capital can you personally leverage? You need to raise money from the market, find traders to do the operation, and find counterparties.
Throughout the entire process, whether it is the possible information leakage from the transaction itself, or the strength of the effects produced by placing the news on the marketplace as an individual, it is far inferior to the Chinese official.
The funds that can be leveraged, and the final revenue, are worlds apart.
National team operation, final revenue can be measured in hundreds of billions, although the unit is RMB. If Lin Ran does the operation, it would at most be measured in tens of US Dollars, and that would still need to be split with Pony.
This is the power that the national machine can exert.
Moreover, after a business reaches a certain level, your business is no longer simply your personal one. Many things you cannot decide at all; you have to communicate and coordinate with the government to obtain the corresponding permissions.
Taking real estate as an example, how could it be that developers sell at whatever price they want? If developers want to lower prices, they can’t lower them too much, or they will be forced to stop.
It’s the same in America, where the US President even directly uses social media to interfere with a company’s CEO hiring, naming and shaming someone as unsuitable and needing to be replaced.
The president using social media to interfere with a company changing personnel—if you heard this ten years ago, your brain would probably crash, doubting if it was an April Fool’s joke.
Of course, this is not the first time for big T; in 2018, he said that General Motors’ CEO Mary should be replaced immediately.
Similarly, this is not the first time for the US President; Jimmy Carter and Obama have done this. Obama publicly criticized British Petroleum’s CEO Tony and said he should be fired, and shortly after, BP really fired him, and even paid a huge fine for it.
It’s just that these are not reported on the Chinese Internet, but in reality, whether domestic or abroad, government interference in businesses has always existed and is unavoidable.
Especially for aerospace companies, it’s even more so.
Lin Ran’s approach is the profit maximization choice made by a Cold War politician after years of mixing in the White House, the optimal solution under his own stance and background.
For him, adding or subtracting tens of US Dollars in personal assets really doesn’t mean much. The high trust from the Yanjing side, greater autonomy, and support intensity are far more important than just money.
Even with 10 billion US Dollars in cash, Lin Ran couldn’t run abroad; that money would just be numbers.
“Mr. Lin, the Yanjing side has never doubted your patriotism and contribution to the country. We have always treated you with the treatment of a national scholar.
It is like this: in addition to the national level first prize and corresponding honors, subsequently the Yanjing side will establish a new Central State-owned Enterprise. This Central State-owned Enterprise’s paid-in capital is 100 billion RMB, which is part of the gains from this financial sniping war I just mentioned, used as seed funding for this Central State-owned Enterprise.
This newly established Central State-owned Enterprise mainly has two business segments: on one hand, promoting the implementation of new Photovoltaics technology through technical cooperation; on the other hand, promoting the implementation of new Photovoltaics.
Implementation includes modifications to old urban projects, like installing new solar panels on the rooftops of urban residential buildings, with electricity digested locally to reduce urban power grid pressure.
And Photovoltaics projects in the northwest frontier, etc.
For this enterprise, Apollo Technology will hold 20% shares, in the form of technology investment.
Then Mr. Lin, you can appoint an executive from your side, and we will arrange a suitable position based on their ability.”
What does this sentence mean? If capable, arrange a position with actual business; if not, arrange positions like union chairman or appointed director that just draw salary.
“Good.” After hearing this, Lin Ran nodded. The position is at best an add-on, an add-on to the reward; 20% shares in a Central State-owned Enterprise of this level is the main part.
Of course, due to Apollo Technology’s mixed ownership structure, the amount indirectly penetrating to his hands will definitely not be a full 20%, but it can still be considered sharing weal and woe with the country.
“Is China’s technological breakthrough in the Photovoltaics field real or just ‘claimed’?”
After trading time ended, Jack Stewart returned home and, as usual, first browsed Reddit for a while.
Today, Reddit brought him unimaginable revenue, making him love this platform even more.
For traders, insider news is sometimes more important than the smell from trading itself.
It gives you more ample trading time and allows you to touch the essence of the problem faster.
Big A’s fund managers get insider news 20 seconds before trading and then rush in big before the market opens; similar operations in America’s capital market are countless.
In Reddit’s solar section, everyone is discussing the latest progress of Chinese technology.
This is a section specifically for discussing solar, with about 170,000 users, created in December 2008.
In the past, the vast majority of discussions here were about things like “I want to build a Photovoltaic Power Generation station on my farm, got a quotation from a local installer, is this quotation reasonable.”
Then below, there would be 100% mentions of China, like replies such as “how is it so expensive, China has it so much cheaper.”
In America, a quotation for installing Photovoltaic modules on a similar villa roof is divided into three parts: the first is the system itself, including Photovoltaic modules, inverters, Photovoltaic systems, quoted at 28,000 US Dollars; then transportation costs, 16,000 US Dollars; finally installation costs. Packaged together, if you can get it done for 50,000 US Dollars, it’s already a very low price.
Whereas in China, even if you choose Huawei’s smart Photovoltaic system, the overall quotation for the same specifications, ensuring completion of installation and use, will not exceed 100,000 RMB.
This leads to China always being mentioned in the solar section, from price to quality, to why America is comprehensively behind in Photovoltaics, and finally a sentence like “we are losing the future.”
After China announced its huge, unprecedented technological breakthrough in Photovoltaics, the hottest discussion inside is about this matter.
In the pinned post in the section, researchers in this industry, Photovoltaics users, practitioners, and enthusiasts all express their views.
“Of course it’s real. The capital market doesn’t lie. The crude oil price crash explains everything. Bulk commodities don’t surge or plummet for no reason. Obviously, China’s technological breakthrough in the Photovoltaics field has dealt a fatal blow to crude oil.”
“What I care about now is when we can let China’s Photovoltaics products enter America at a reasonable price, instead of artificially creating unfair market factors, forcing us to buy super expensive American domestic goods.”
People who can afford it, are willing to buy, and willing to install Photovoltaic Power Generation facilities themselves all know very well why Photovoltaics are so expensive in America.
Because of the high taxes, China cannot directly export to America and needs to do re-export trade through third countries.
Then local service providers add another markup.
If it can be directly imported from China, through communication with Amazon and China merchants, someone has calculated that the cost would be reduced by at least 70%.
This is also a major blow to America’s shale oil.
What concerned Jack Stuart the most was one of the replies:
“My mentor is a Nature reviewer for photovoltaics. The technology breakthrough in China is real, 100% authentic.”
This user with the ID Almond Candy is an active user on the solar board, always renowned for being professional. This is the first time he has mentioned his personal background.
“The most critical part among them is that China has built a completely new model, and this model bypasses the Shockley-Queisser limit.
In the field of materials science, this is epoch-making work. Mathematicians who could possibly achieve this in the past would not focus their attention on the photovoltaics field. Materials scientists working on photovoltaics problems fundamentally do not understand such profound mathematics.
This is dimensional strike of mathematics in the materials field.”
