A report from SolarPower Europe and Fraunhofer ISE believes that EU-made solar modules € 0.103 ($ 0.12)/W costs more than Chinese import, but targeted policy can close the gap and help the EU’s 30 GW annual production objective reach by 2030.
Producing a solar module in Europe with EU-made solar cells costs around € 0.103 ($ 0.12)/W more than producing the same module in China, according to a new report.
The The production of solar module to Europe again Report, by SolarPower Europe and the Fraunhofer Institute for Solar Energy Systems (ISE), says that the gap is caused by higher costs for equipment, materials, labor, buildings and facilities.
As a result, Utility scale Solar installations on the basis of EU-made solar cells cost approximately € 0.608/W compared to € 0.50/W for an equivalent Chinese system, which translates into a level of electricity (LCOE) that is 14.5% higher for European modules. The percentage falls within the 15% extra cost-auction cap in the Net Zero Industry Act (NZIA) for non-prize criteria at auctions of renewable energy.
The report says that the prayer-made solar sun imported by the European and Chinese can be reduced to less than 10% with the correct mix of policy, including combining capex and OPEX schedules under output-based support schedules.
It suggests Setting up an EU level-based support-based support schedule dedicated to solar production that includes subsidies, loans and decoupling instruments for scaling up solar energy in Europe, while it also covers Capital and operational expenditure in the form of production-based support. It points to the success of similar schemes in other markets, such as the Reduction Act (IRA) inlet of the US and the production of India production.
The report also emphasizes a cost difference between NZIA-compliant EU-made and NZIA-compliant non-EU-Mempt modules from € 0.022/W to € 0.058/W. As a result, the report says that governments are well advised to integrate ‘Made in EU’ bonus points or an EU preference approach into support schedules, in particular for solar energy or public tenders.
By 2030, the European Union has set an objective of at least 30 GW of annual production capacity for solar energy by 2030. The report says that it is technically realistic that this production capacity can be built along the solar chain by the end of the decade.
The benchmark figure would take into account between 30% and 50% of the EU solar market and about 2% to 3% of the global solar market. The report estimates between six and ten factories that have to be built on a minimum size between 3 GW and 5 GW per year throughout Europe to facilitate capacity.
To achieve the goal of 30 GW, the European solar industry per year needs between € 1.4 billion and € 5.2 billion for support, the report adds. It also estimates that up to 39% of the costs can be reclaimed by macro -economic benefits, including a maximum of 2,700 jobs and € 66.5 million in annual tax and social income.
Solarpower Europe CEO, Walburga Hemetsberger, noted that Europe with the right policy can supply 30 GW of solar production by 2030. “To achieve the goal of 2030, the EU and the Member States have to act quickly,” hemetsberger added. “Without interventions, Europe threatens to lose the remaining industrial and technological possibilities in solar energy.”
The report also warns that the European production sector will have trouble competing with dominant global players and the risk runs its remaining industrial and technological solar options without the proposed interventions. “Because scaling up production facilities usually takes two to three years, there is only a narrow window left to create the required conditions for investors to bind themselves in the EU until 2030,” says it.
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