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The European solar industry has warned that a flood of cheap Chinese imports has pushed some manufacturers to the brink of bankruptcy, hampering EU efforts to boost local production of green technology.
SolarPower Europe, the industry’s trade group, wrote to the European Commission on Monday saying that soaring inventories and “intense competition” from Chinese manufacturers to gain market share in Europe had caused the price of solar modules to fall by more than a quarter on average. The beginning of the year.
“This creates a concrete risk for companies to go bankrupt as a significant amount of their stock would need to depreciate in value,” the letter said.
It added that Norwegian Crystal, a producer of silicon ingots used in solar cells, filed for bankruptcy last month. Another Norwegian solar company, Norsun, said this month it would suspend production until the end of the year.
The EU wants solar to become the bloc’s largest energy producer and work towards a goal of generating 45% of its energy from renewable sources by 2030 – a target that will be voted on by the European Parliament this week.
But China’s dominance of the solar supply chain means its products account for about three-quarters of the EU’s solar imports, raising concerns that the EU is becoming as dependent on China as it was on Russian gas until Moscow invaded in full European Union. Ukraine.
SolarPower Europe said the cost of manufacturing solar modules in Europe is more than double current spot prices.
The EU had already begun imposing tariffs on Chinese imports in 2012 to limit unfair competition from China after Beijing provided huge subsidies to its solar industry. But the EU lifted those restrictions again in 2018 to increase the installation of renewable energy, just a year before the commission declared China a “systemic competitor.”
Brussels has not reinstated the measures since then, despite recently urging European companies to “de-risk” Chinese supply chains as part of a broader effort to bring manufacturing back amid rising geopolitical tensions.
A spokesperson for the commission did not immediately respond to a request for comment.
The letter said the sharp fall in prices means the EU’s target of producing 30GW of solar supply chains in Europe by 2030 is now “at serious risk”. The wind industry has made similar calls to Brussels, fearing turbine makers are also being undercut by Chinese rivals.
Western executives have also warned that China is subsidizing and building electric vehicle battery factories on a massive scale far beyond what is needed to meet domestic demand, a trend that could also frustrate Europe’s ambitions to expand electric vehicle battery production.
SolarPower Europe’s statement was echoed in a separate letter on Monday signed by more than 40 solar companies including Swiss company Meyer Burger and German PV manufacturer Heckert Solar.
The second letter reads that European spending on solar modules has increased from 6 billion euros in 2016 to more than 25 billion euros last year, resulting in a large number of Chinese solar panels currently in European warehouses. China has enough photovoltaic cell storage to meet more than twice Europe’s total annual demand, the report said.
Chinese companies are now “taking a dumping stance in the European market”, offering two-year contracts at prices that are “consistently lower” than spot market prices. It added that such deals often include terms requiring minimum orders and exclusivity.
Letters from the solar industry all recommend that the European Commission urgently acquire the stocks of European solar manufacturers and speed up the development of regulatory plans to ban forced labor products.
About two-fifths of global production of polycrystalline silicon, the main raw material for solar panels, comes from the western Xinjiang region, where rights groups accuse the Chinese government of forcing Muslim minorities to work in factories in internment camps. Beijing rejects any human rights violations in the region.
SolarPower Europe CEO Walburga Hemetsberger said she knew others in the industry would also petition the commission. “We all agree that uncontrolled price falls are a significant risk to the industry and EU leaders must take urgent action.”
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