Chinese competition poses 'existential threat' to Europe's solar industry

Cheap Chinese solar panels are flooding the EU market and threatening the viability of homegrown companies.

Transcript

00:00 Solar panel manufacturers in Europe say the sector is facing an existential challenge

00:08 from heavily subsidized Chinese competitors. According to insiders, Chinese solar panel

00:14 manufacturers have a near monopoly on the sector, and if no measures are taken, Europe's

00:20 industry could collapse within months. European manufacturers have asked the European Commission

00:25 for emergency aid, including the purchase of accumulated stock to provide liquidity.

00:32 "So China has been subsidizing their industry for more than a decade. They took a strategic

00:39 decision for more than 15 years ago that they saw PV as a strategic technology. They have

00:47 done so in other areas such as electric vehicles and batteries, etc."

00:53 Lower prices elsewhere have made several companies decide to relocate outside of the continent,

00:59 whilst others have made staff redundant.

01:02 "To fight against the fierce competition from China and avoid falling into the broken

01:06 bank, solar panels like this have had to adapt and innovate much more in low-income countries,

01:11 for example by creating this solar panel, which is much lighter than the usual ones

01:15 and can be installed on roofs that do not support the weight."

01:21 But even for those innovators, the situation could soon become untenable.

01:26 "If it takes one or two years, a lot of companies, and also us, we will see some impact, definitely,

01:34 with having to go down with price levels and being less competitive and profitable."

01:39 Chinese competition not only endangers companies, but also could affect Europe's industrial

01:45 independence. A module produced in China is about 50 percent cheaper than one made in

01:51 Europe. Meanwhile, European producers account for only 3 percent of the EU market.

01:56 In the medium term, the EU has two directives almost finalised that could reduce competition.

02:02 The first would require 40 percent of the clean technologies installed in the EU to

02:07 be manufactured here as well. The second would prohibit the sale in the EU of products made

02:13 with forced labour, something that happens in several areas of China.

02:17 The European Commission has not yet announced any emergency measures and is still assessing

02:22 the situation.

02:23 "It's important that the solar market in Europe keeps growing because we're still not at the

02:28 levels that we need to reach the 2030 targets. So any industrial strategy for the manufacturing

02:35 needs to make sure that it doesn't impact negatively the continued growth of the European

02:40 solar markets."

02:43 Striking the right balance is essential for the EU. Solar energy is one of the cheapest

02:48 and easiest to install. So rapid deployment could make a difference in meeting climate

02:54 targets. By 2030, 42.5 percent of all EU energy will have to come from renewable sources.

03:01 END

03:05 (whooshing)