The future of the European solar industry and a resilient European energy supply are in utmost danger – without immediate actions, the European PV manufacturing industry will disappear forever

Leaders of the European solar manufacturing industry have come together to address an alarming crisis caused by the unsustainably low-priced PV modules from China. Despite efforts like the Temporary Crisis and Transition Framework (TCTF) and the Net-Zero Industry Act (NZIA), intentional actions by Chinese PV manufacturers threaten the European solar PV industry’s renaissance. In an Industry-wide outreach to the EU and its Member States, the European PV industry urges the European Union and its Member States to take immediate action to avert a looming catastrophe.

The European solar industry and the plan to strengthen European resilience are under threat from Chinese PV manufacturers intentionally driving down prices. Over recent months, massive stockpiles of Chinese PV modules in European ports, equivalent to Europe’s entire annual installation demand, have built up. Imports are projected to reach 120 GW in 2023, overshadowing expected installations of just over 60 GW.

As a result, European PV module production has plummeted from 9 GW in 2022 to approximately 1 GW in 2023, with European manufacturers facing insolvency. The manufacturers now face a choice: continue production shutdowns and face bankruptcy or seek refuge in regions like the US that support their PV industry.

To address this crisis, the signatories, with ESMC in the lead, have urged the European Commission and Member States to take swift action, including:

1. Immediate exclusion from the European market of solar modules produced with forced labor. We cannot compete with and will not turn a blind eye to modern slavery. Large volumes of unethical produced PV modules — originally bound for the US market but prevented to enter by the existing Uyghur Forced Labor Prevention Act (UFLPA) — are now being dumped in Europe which lack processes to stop modules manufactured with forced labor.
2. Swift emergency acquisition of European PV manufacturers’ PV module inventories in response to the forced price decline caused by Chinese unjust trade practices. These PV modules, for example, could be procured through the refinement of competitive bidding process within the Temporary Crisis and Transition Framework (TCTF) or elaborating the Ukraine Facility framework for Ukraine aid and rebuild, and/or eventually as well for energy aid for Africa. An expedited emergency measure aimed at protecting European PV module producers during this pivotal period will effectively tackle this issue and is critical for the survival of many European manufacturing companies.
3. Encouragement for European PV installers and project developers to incorporate a minimum share of European production along the entire PV value chain for European PV deployment. This will secure a stable market for European manufacturers in the medium term. A prerequisite for this is a clear definition of what a European solar PV module is. This must be developed and implemented within the framework of the currently ongoing negotiations of the Net-Zero Industry Act Articles 19 and 20. The inclusion of non-financial criteria (NFC) in PV auctions should also be included as reward the environmental and social benefits of European PV modules is a key tool for levelling the playing field with Chinese modules. In particular, a coherent framework for rating the social responsibility performance along PV value chains is a prerequisite for closing the cost gap with Chinese competition. The European PV manufacturing industry urgently requires assurance regarding the uptake of domestic production, commencing no later than 2026. This could be initiated with a 10% target, that is subsequently increased every year toward the 2030 goal of 40%, as stipulated in the NZIA. However, the current version of NZIA lacks the necessary yearly benchmarks, concrete mechanisms, or a mandatory framework, which is crucial for securing future investments in the sector. In addition, the introduction of a Net-Bonus system (resilience criteria and ESG criteria) within the NZIA framework, that will support all parts of the European value chain should be seriously considered.

These measures are essential to safeguard European PV module producers and ensure the industry’s future.