Almost nothing remains of Germany’s once-thriving solar industry. In the spring, Swiss maker Meyer Burger, the region’s biggest hope for solar, announced that the factory in Freiberg, Saxony, no longer had a future. At that time, it was said that 400 jobs will definitely be lost, and 100 workers are being negotiated to continue their employment elsewhere.
Solar panels are booming like never before. Modules are now so dirt cheap that… Netherlands and Germany is used as a wall. You read it right. Instead of being installed on the roof, the panels are installed as a property boundary, as “Financial Times”, reports in April.
“Why fence when you can just use a few solar panels, even if they’re not perfectly positioned for sunlight?” “When the panels themselves are so incredibly cheap, then installation costs and location become limited, and then you get a do-it-yourself mindset.”
The number one country for solar energy is China
One country is behind the rise in solar module prices: China. Middle Kingdom manufacturers are literally flooding the world with cheap panels. According to Bloomberg, locally produced products cover In Europe only two percent of demand, while 90 percent of modules From China come on
Oxford University data highlight the boom. In 2023, China has already installed 584 terawatt hours of solar power plants, which is 100 terawatt hours more than in 2022. The USA is still ahead in terms of population. But the distance is getting shorter.
Without a domestic solar industry, Beijing would not be able to push through this expansion. Only the corporations there are suffering from a massive price war. Bloomberg reports – and I want help from Beijing.
The solar boss talks about “bloodthirsty competition”.
Jifan Gao, Boss Fon Trina Solar Co., which has 40,000 employees worldwide, has called on the government to coordinate industry development to prevent excessive competition. Gongshan Zhu, chairman of CGL Technology, spoke at a conference in Shanghai about “the industry tearing each other apart in bloody competition.”
Zhu argued that the government should hold auctions for new installations to protect producers from tight supply. “We cannot be short-sighted, the industry must come to a consensus within comfortable profit margins,” Zhu continued.
Gao, for his part, criticized “blind investment” in the sector, which would eventually force consolidation. Regional governments that want to attract companies are also guilty. “Local governments want to attract business, and banks want to lend too much,” Gao said.
Even President Xi Jinping warned in May that overinvestment in the sector would be counterproductive. In some cases, Bloomberg reports, companies have already been forced to lay off workers as prices have fallen below production costs.
The EU is ready to protect its industry
This is not good news for consumers, including in this country. Consolidation in manufacturing will automatically mean less competition. Zhu’s reference to “comfortable profit margins” also suggests that the downward trend in prices is unlikely to continue.
Punitive tariffs imposed on Chinese electric cars just this Wednesday also show that the EU is quite willing to protect domestic production.
Of course, the solar industry is nowhere near as rudimentary as the auto industry. However, there are such voices, e.g from green MEP Michael Bloss. On X, before Twitter:, wrote Bloss after Meyer Burger abandoned the Freiberg factory. This industry will be as big as the auto industry by the 2030s.”
Protectionist tendencies exist and are not new at all. Just about half a decade ago, the EU lifted punitive tariffs on Chinese solar modules. Since October, politicians in Brussels have been debating whether import tariffs will be necessary again. Argument: Without prohibited state aid, Chinese manufacturers would not be able to offer low prices.
Either way, it will be more expensive for the consumer
Demand for solar modules is also growing in the oil-hungry US, as expansion numbers show. There, however, there are fewer problems with excess supplies from the Far East.
Reason. Starting in mid-2022, the U.S. will refuse to import goods from the Uyghur minority in Xinjiang province that are suspected of having been produced with possible forced labor. Manufacturers in China mainly source silicon for panels from there. Producers must prove that their products are not made with forced labor.
These import controls were also a factor in the flood of Chinese modules in Europe in the first place. But whether the Chinese sector consolidates and is therefore able to charge higher prices or the EU imposes tariffs on imports, it will become more expensive for anyone looking to install a solar system on their roof for the foreseeable future. , or at least not cheaper.
