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Incumbent Upon ‘Right Political Will’, Europe’s Solar Sector Association Offers ‘Balanced Solutions’ For Solar PV’s Industrial Resurgence

solar panels
  • Solar PV industry in Europe has voiced its stance against any trade barriers for imported solar modules in a single market 
  • It believes trade barriers are not the solution and can instead be a lose-lose strategy for Europe 
  • Industry association recommends a series of measures that it believes can be implemented within weeks if there is the right political will to help the European PV manufacturers 

Amidst reports of Germany contemplating trade barriers to protect solar PV manufacturers from falling module prices, Europe’s solar power sector association SolarPower Europe (SPE) strongly advises against any such step that can have adverse impact on the market. 

A statement by the European solar PV lobby association points at overcapacity on the supply side for solar modules leading to sharp drops in price for solar modules and other components. However, it does not see trade barriers as the solution to help European solar manufacturers. 

According to the SPE, “As history has shown, investigating and implementing trade barriers on solar is the ultimate lose-lose strategy for Europe.” A decade ago, European manufacturing companies had successfully called for minimum import prices. While this had caused big headaches for the sector, it didn’t help ailing manufacturing companies at the time.

Instead of trade measures, the association has offered ‘balanced solutions’ to build a strong and credible industrial strategy for solar PV which, provided there is the ‘right political will,’ can be implemented in a ‘matter of weeks.’ These are:  

  • Adjust the EU State Aid framework (the Temporary Crisis and Transition Framework) to allow Member States to support running costs of factories – i.e. OpEx 
  • Allow for specific resilience auctions within Member States under a swiftly-adopted EU Net-Zero Industry Act 
  • Set up an EU-level financing instrument dedicated to European produced solar PV, like a Solar Manufacturing Bank.  

Gunter Erfurt, CEO of Swiss/German cell and module maker Meyer Burger, said, “Tariffs are not a good answer to the current challenges in the European solar industry, there are better and especially faster instruments for the development of European solar production: Instead of sanctioning the entire industry through tariffs, we must incentivize solar installations that originate from resilient European solar production. This way, the deployment of solar energy can continue undisturbed while the European solar manufacturing can grow steadily.”

BNE Bundesverband Neue Energie (Federal Association of the New Energy Industry in Germany), believes the argument of a ‘dumping attack’ from Chinese manufacturers is ‘completely unfounded.’ 

In a LinkedIn post, BNE Managing Director Robert Busch blames the sharp drop in module prices to the overcapacity in European warehouses since here the traders were filling up warehouses with modules following increased demand for solar in the wake of the Russian invasion of Ukraine. 

“Normal market activity must not lead to protectionism under any circumstances,” stressed Busch. 

Notably, at the State Premiers Summit in Germany on Sept. 30, German policymakers and PV industry representatives agreed to a 10-point plan aimed at supporting European companies. The industry reportedly rejected any talk of punitive tariffs against Chinese modules, according to a Handelsblatt report. 

A July 2023 Rystad Energy report of Chinese solar modules hoarded in European warehouses expected to grow to 100 GW DC capacity by the end of 2023 was followed by Norwegian silicon wafer manufacturer NorSun shutting its fab in Norway and laying off employees ‘temporarily’. It blamed Chinese modules selling at exceptionally low prices in Europe as the main reason. While prices are indeed at record low levels, data from PvXchange in a SolarPower Europe position paper, Saving European Solar Manufacturing, show that similar low levels were reached already at the beginning of the pandemic before they started its steep upwards trend due to strong demand  during the energy crises met with Covid related supply chain issues.  

Source from Taiyang News

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