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Brussels considers emergency support measures for Europe's solar panel manufacturing industry, as cheap Chinese imports threaten local production and industry data warns that continental producers are "on the sidelines".
Four European factories have closed or announced plans to do so in recent weeks, as the bloc prepares to announce a plan next month to reduce greenhouse gas emissions that will require it to invest increasingly in renewable energy. Industry representatives are responsible for Chinese competition.
"There is huge potential globally and European manufacturers cannot sell their products without incurring huge losses. We have to deal with the Chinese threat," said Johann Lindahl, secretary general of the European solar industry group's Manufacturing Council.
European Commission action could include an anti-dumping investigation against China (which could lead to punitive tariffs) or incentives for national governments to keep factories open, European officials told the Financial Times.
The Commission is "aware of the challenges" facing the solar sector and Brussels is considering "all options" for the trade regime, an official said.
But the industry is divided on whether such measures would help.
The ESMC said manufacturers were “stretched” and that most European production could be halted within three months.
“Either [the manufacturers] will be forced to file for bankruptcy, or…. If they have the resources, they will emigrate to the United States,” Lindal said. Washington provides large subsidies to companies that invest in green technologies in the United States.
The ESMC held an emergency board meeting on Friday to discuss the “very serious situation,” Lindahl said.
“We need to review trade protection measures… because we see no immediate further steps to be taken.” The quickest option would be a safeguard investigation by the Commission, limiting imports or increasing tariffs. An anti-subsidy or anti-dumping investigation is also possible.
However, the Chinese telecommunications company is openly campaigning against the trading system SolarPower Europe, an industry body that counts Huawei among its members.
“We have repeatedly warned that national and European politicians must act quickly and offer practical solutions,” said Wallberg Hemetsberger, CEO of SolarPower Europe. “State aid rules, flexibility auctions and loan guarantees are among the most urgent measures that policymakers should consider.”
Another senior industry official said history showed that trade barriers would create a "lose-lose situation" and leave the bloc's climate goals "in the balance."
The EU imposed anti-dumping measures on Chinese solar cells, wafers and panels in 2013, then lifted them five years later to boost supply and meet renewable energy targets.
Europe produces less than 3% of the solar panels needed to meet the bloc's 2030 solar energy targets. Supporters fear implementing trade measures could lead to supply losses and project delays
Henning Rath, supply chain director at German solar installer Enpal, which buys solar panels from China, said reintroducing protectionist measures would disrupt the market. “The Chinese today are the most competitive, not only in terms of price, but also in terms of quality.
Europe does not have a "long-term industrial strategy" for renewable energy producers like countries such as China and India, he added.
Swiss company Meyer Berger announced this month that it will close its German solar module plant (one of Europe's largest by volume) in April and increase production in the United States unless it receives government support . According to him, around 500 jobs will be affected.
« The Chinese manufacturing overcapacity and the strong increase in commercial restrictions imposed by India and the United States [in China] lead to an important offer and the distortions without precedent on the European solar market in 2023 », a declaration the society. This is a statement.
Last October the European Commission, through the European Investment Bank, announced a "wind energy package" which provides accelerated authorization procedures and financial guarantees for wind turbine manufacturers. The directive was issued in response to concerns that cheap Chinese imports could harm wind energy producers. The solar industry has said it needs similar measures.
EU officials said solar energy was addressed in the 2022 strategy, raising the bloc's deployment target to 320 gigawatts by 2025, a 43% increase from previous targets set in 2019.
According to the latest market report from SolarPower Europe, the sector is growing rapidly, with annual installed capacity increasing by almost 40% for three consecutive years.
However, the report warns that growth will fall to 11% this year due to lack of grid connectivity and licensing issues.
This story has been corrected to clarify that the ESMC is not investigating an anti-dumping complaint against China.
