Solar power manufacturers operating in Europe have warned the EU they will face bankruptcy under current market conditions, calling on the bloc to implement “emergency measures” to keep the industry afloat.
In a letter to European Commission officials including President Ursula von der Leyen, the European Solar Manufacturing Council (ESMC), which represents around 80 solar photovoltaics (PV) companies, said the industry requires support within the next two months otherwise it faces relocation or bankruptcy.
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“We need active political and financial support now. Otherwise, we are to lose a majority of the European solar PV manufacturing industry,” said Johan Lindahl, secretary-general of the ESMC.
The ESMC said the key problem lies in an oversupply of heavily subsidised solar PV modules coming into European markets from China. It estimates there is a stock of approximately 140–170 million PV modules in European ports and warehouses, equivalent to 70–85GW of electric capacity.
The oversupply is the result of “aggressive” Chinese subsidies, which has led to a collapse in module prices and left European PV manufacturers with large unsold inventories, the ESMC said.
Von der Leyen has already, in the past few months, recognised the threat Chinese subsidies pose to Europe’s solar industry. In her last State of the Union address in September, she addressed in detail the perceived foul play from China regarding its clean energy subsidies and dominance in energy transition supply chains.
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By GlobalData“We have not forgotten how China’s unfair trade practices affected our solar industry,” she said, adding that many businesses have been “pushed out by heavily subsidised Chinese competitors”, with some forced to declare bankruptcy. Von der Leyen has also said the same is true for heavily subsidised electric vehicles (EVs) from China, promising to launch an anti-subsidy investigation into EVs manufactured there.
The ESMC’s letter set out three key measures the Commission should “urgently adopt” if it is to avoid a collapse of domestic solar manufacturing. The first asks the bloc to establish an EU-level buyout facility for accumulated EU solar PV module inventories.
The second calls for an immediate modification of the Temporary Crisis and Transition Framework, which was adopted as a support measure for sectors key to the energy transition. The ESMC wants the framework to aid the financing of all projects using EU-produced solar PV modules and the operational expenditures producers face.
Third, the ESMC calls for the EU to accelerate the implementation of protective measures for solar producers as part of the Net-Zero Industry Act, principally by creating a simplified and effective resilience auctions system as a temporary emergency.
