Renewables

EU rules out measures against imports of solar panels from China

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Published

February 6, 2024

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Published:

February 6, 2024

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European solar manufacturers are struggling to break even and accusing China of unfair trade practices, but the European Commission gives priority to climate goals and renewable energy deployment. SolarPower Europe is calling for urgent support to the domestic industry instead.

European Commissioner for Financial Stability, Financial Services and the Capital Markets Union Mairead McGuinness acknowledged in an address to the European Parliament that a “surge in imports” slashed the prices of photovoltaic equipment by more than 40%. The situation benefits citizens and installers, but it is “clearly a challenge” for manufacturers in the European Union, she said.

The domestic industry has repeatedly warned that Chinese imports of solar panels are jeopardizing its survival. Even though a response was expected from the European Commission, McGuinness ruled out antidumping measures. They should be activated only when they are “in the overall union interest,” she stressed.

The EU should intervene against dumping only when it is in its overall interest, European Commissioner Mairead McGuinness said

The commissioner added that trade measures must be “weighed against” the energy transition targets and solar power in particular. The EU needs to have access to affordable photovoltaic panels, in her view.

McGuinness did admit that the dependence on Chinese imports could strengthen further. More than 97% of solar panels installed in the EU are imported and most come from China, she asserted.

Nevertheless, the European Commission is working on a ban on equipment produced with forced labor. In the long-awaited Net Zero Industry Act, on which EU lawmakers are nearing a deal with member states, the quota for domestic manufacturing could be set at over 30%. Furthermore, the proposed legislation contains penalties for exporters to the 27-member bloc that abuse a dominant position in the market.

Import curbs could halve solar power deployment

The European Solar Manufacturing Council (ESMC) reiterated that the EU is drowning under the stockpiles of PV panels. It estimated the current surplus at 70 GW to 85 GW.

Chinese producers sell modules at prices below their costs, the industry group claimed. ESMC called for the establishment of a special fund that would support sales and purchases of domestic panels of 800 MW in total, wafers and other elements.

More support, and better access to support, is critically needed, according to SolarPower Europe

Its stance mirrors calls from SolarPower Europe. It urged the EU to roll out environmental and social standards for procurement and auctions.

“European solar manufacturers are in a different landscape compared to May 2022, when the EU Solar Strategy was announced. Manufacturers are going bankrupt. More support, and better access to support, is critically needed… History has shown that trade defence measures did not bring back the reshoring of solar manufacturing and coincided with deep declines in solar deployment. Our modelling suggests that so-called safeguarding measures on solar could lead to more than 30% decline in solar installation this year and cut deployment in half in the years to come,” said SolarPower Europe’s Chief Executive Officer Walburga Hemetsberger.

The European Commission’s Joint Research Centre has determined that the costs of solar panel manufacturing in China is 35% lower than in Europe.

Enel pushes on with expanding its solar module production facility

On the other hand, Enel recently secured a EUR 560 million financing package for the ongoing expansion of its 3Sun solar panel factory in Catania in Sicily. The European Investment Bank and a pool of Italian banks led by UniCredit is extending the loans, with backing from the EU and the government. The EIB may add more this year.

Moreover, Italian Prime Minister Giorgia Meloni said Enel Green Power would receive EUR 90 million from the National Recovery and Resilience Plan (NRRP) for the project. It plans to complete the facility by the end of the year and reach 3 GW in annual capacity.

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