Recently, French Economy and Finance Minister Le Maire announced that he would support French domestic solar panels in an effort to undermine the dominance of Chinese PV manufacturers in Europe.
Why does France want to point fingers at Chinese PV?
How should China's PV respond?
The sword is aimed at Chinese photovoltaics, which French Finance Minister Le Maire called a "solar battle plan".
Specifically, it is mainly divided into two aspects:
The first is to provide subsidies to support the domestic photovoltaic industry.
French companies Carbon SAS and HoloSolis SAS are leading a €2.2 billion investment in two solar panel production plants.
In addition to additional financial support, France plans to grant 200 million euros in tax breaks.
France deploys offshore PV in the Mediterranean, 1.5km from the port of Sète
The second is to set a threshold to hinder Chinese photovoltaic enterprises.
Starting in the middle of this year, France will also strengthen carbon content standards in government tenders for rooftop PV projects, and increase incentives for the use of "low-carbon" panels in small-scale ground-mounted PV projects.
This is a disguised threshold to prevent Chinese photovoltaic products from entering the French market.
In fact, this is not the first time that the EU has besieged China's PV.
As early as 2013, the EU imposed anti-dumping and countervailing measures on Chinese solar panels, wafers and cells, and extended them for 18 months in March 2017, eventually expiring in September 2018.
The Correction Bureau has noticed that in the past two years, the voice of encircling China's photovoltaic has risen again in the EU.
In October last year, Reuters reported that the EU planned to use tools such as subsidies or "tariff sticks" to protect EU businesses.
In December, German Economy Minister Habeck said in an interview with the German media "German Newsroom Network" (RND) that he planned to strengthen the country's solar manufacturers and compete with Chinese manufacturers by providing state subsidies.
Habeck inspects his country's solar manufacturers
In the end, these plans fell through due to internal disagreements.
It is worth noting that why is the EU eyeing China's PV?
A basic fact is that Chinese PV is indeed too strong.
According to customs data, the mainland's PV module output has ranked first in the world for 16 consecutive years. Among them, photovoltaic modules account for more than 75% of the world's market, cells account for about 80% of the market share, and silicon wafers have a market share of more than 95%.
Comparison of PV production capacity in global economies
China's high-quality and low-cost photovoltaic products have made the EU's competitors unable to parry.
Solar panel prices have fallen to around €0.15 per watt from a peak of around €0.24 per watt at the beginning of the year, while European manufacturers are pricing €0.30, according to data provided by the European Solar Manufacturing Council.
EU companies have no cost advantage and have had to shut down.
As a result, more than 90% of the silicon ingots and wafers used to make solar panels in the EU come from China.
For example, the Francisco Pizarro solar power plant in Extremadura, Spain, opened in 2022 and is one of the largest photovoltaic plants in operation in Europe, using solar panels entirely from China.
For China's photovoltaics, the EU is both love and hate.
On the one hand, the low price of photovoltaic products in China has greatly reduced the cost of photovoltaic power generation construction, which is conducive to helping the EU achieve the established clean energy goals.
On the other hand, objectively, China's PV does squeeze the living space of EU PV companies.
This is not easy for the EU to accept, both in terms of honor and interests.
At the same time, because PV is highly dependent on China, the EU is also worried about the security of the supply chain.
The EU's support for local PV companies is also hoping to compete with Chinese companies for the market.
As costs gradually decrease, solar energy will become the most competitive energy source in the coming years.
In 2023, the global installed capacity of photovoltaic power generation has surpassed that of hydropower.
According to forecasts, by 2044, photovoltaics will account for more than half of the world's electricity generation.
2021-2028 new global PV installed capacity
Most of the world's major economies have aggressive plans for PV development.
The EU plans to double its total installed PV capacity to an expected 484GW by 2026.
Saudi Arabia plans to reach 40GW of installed PV capacity by 2030.
India predicts that by FY2029~2030, a total of 292.6GW of PV systems will be installed.
Broad market prospects mean opportunities.
In 2023, the export of China's main photovoltaic materials (silicon wafers, cells, modules) will reach 49.066 billion US dollars, with a cumulative export of more than 200 billion US dollars.
EU companies also want a piece of the pie.
In the face of menacing encirclement and interception, how should China's PV respond?
Experience is often the best answer.
The first is to maintain strategic focus.
Expanding and strengthening strategic emerging industries such as photovoltaics is not a matter of one enterprise or one industry, but requires strong strategic determination from the state and continuous support from the government.
In this regard, we can compare it with Germany.
In the article "Germany has just abandoned nuclear power, why is it worried about over-dependence on China?", the Correct Solution Bureau introduced that Germany was originally a pioneer in the photovoltaic industry, and it is not only a photovoltaic manufacturing power, but also a photovoltaic installation powerhouse.
Germany's PV installed capacity has been growing by leaps and bounds since 2008, but in 2012 it stepped on the brakes, leading to a large-scale bankruptcy of German PV companies.
1992-2022 new installed solar PV capacity in Germany
As a result of this disaster, the German photovoltaic industry collapsed.
A lesson from the past, a teacher for the future.
We should continue to maintain our strategic focus and support the healthy development of the photovoltaic industry.
The second is to continue to tackle key problems in scientific research.
Nearly 20 years ago, mainland polysilicon production accounted for only 0.3% of the world's total, and more than 95% needed to be imported.
By 2022, mainland polysilicon production accounted for more than 85% of the world's total, and it was exported to all over the world.
China's polysilicon production from 2011 to 2024 Image source: Qianzhan Industry Research Institute
The mainland photovoltaic industry has grown from scratch and from weak to strong, which is inseparable from the continuous breakthrough of key core technologies.
Taking photovoltaic cell technology as an example, since 2014, the efficiency of crystalline silicon cell laboratories in mainland China has broken the world record 42 times.
LONGi Green Energy, a leading photovoltaic company in mainland China, has a national-level enterprise technology center and eight provincial-level enterprise technology centers, and has invested more than 22 billion yuan in R&D since its listing in 2012.
In the article "Can Japan's 2 trillion yuan bet on new solar energy technology catch up with China?", the Correct Solution Bureau introduced that Japan is making every effort to develop the third-generation photovoltaic cell technology - perovskite, hoping to catch up with China in the photovoltaic industry.
In fact, in the perovskite track, the progress of the mainland is faster.
The Bureau noted that on November 3, 2023, according to the latest certification report of the National Renewable Energy Laboratory (NREL) of the United States, the efficiency of crystalline silicon-perovskite tandem cells independently developed by LONGi Green Energy reached 33.9%, setting the highest efficiency record for crystalline silicon-perovskite tandem cells in the world.
Mainland photovoltaic enterprises should continue to increase R&D efforts in order to always lead the development of the industry.
The third is to amplify the advantages of the industrial chain.
The world's most complete photovoltaic industry chain allows the mainland photovoltaic industry to have both technical advantages and scale advantages, which are transmitted to the product side, which is the price advantage.
As mentioned above, from 2013 to 2018, the EU imposed anti-dumping and countervailing measures on Chinese solar panels, wafers and cells.
During this period, Chinese enterprises exported photovoltaic cells and modules to Europe faced an average anti-dumping duty of 47.6% and a maximum of 67.9%.
From 2011 to 2019, the proportion of China's output in each link of photovoltaic accounted for the world
The Correction Bureau observed that these measures of the EU have not prevented Chinese photovoltaic products from occupying the European market.
According to the International Energy Agency (IEA), the cost of PV modules in China is 10% lower than in India, 20% lower than in the United States and 35% lower than in Europe.
This shows that as long as the mainland amplifies its supply chain advantages, it is not afraid of Europe's encirclement and interception.
According to the International Renewable Energy Agency, the average LCOE of PV projects has fallen by 80% over the past decade.
This is largely due to the large scale and low cost brought about by Made in China.
The question is, large-scale and low-cost are advantages, but should we blindly pursue large-scale and low-cost?
As the saying goes, it's too much.
In the view of the Correct Solution, what is more important than large-scale and low-cost is sustainability.
Taking the EU market as an example, China's photovoltaic industry has occupied the European market with its large-scale and low-cost activities, but it has also aroused the disgust and concern of France and Germany.
This kind of antipathy and concern will make Chinese PV unsustainable in the European market.
In business, photovoltaics are essentially a business.
If Chinese companies want to continue doing business in Europe, they must learn to share the benefits.
The best way to avoid being thwarted by the EU is to take the initiative to cross the barrier and become part of the EU industrial system.
Going overseas to build factories is becoming the consensus of Chinese photovoltaic enterprises.
Taking LONGi Green Energy as an example, since 2015, LONGi Green Energy has been actively deploying in the Asia-Pacific region, and has successively established factories in Malaysia and Vietnam.
The commencement ceremony of the first phase of LONGi Green Energy's Shuangbuntan module plant in Malaysia and the commencement ceremony of the second phase of the project
LONGi Green Energy is partnering with U.S. clean energy developer Invenergy to build a 5 gigawatt (GW) PV module plant in Ohio.
In the future, LONGi Green Energy also plans to build its first European factory in Germany.
If the plan goes well, it will be the first plant set up by a Chinese solar company in Europe.
Building factories overseas, on the one hand, can better carry out localized operations to meet the local market demand, and on the other hand, can actively avoid trade barriers and potential policy risks.
At the same time, it can also provide jobs and create economic benefits for the host country.
China's PV should be brave to go to sea, and a win-win business can be sustainable.
Back in the domestic market, we must also be wary of overcapacity.
In recent years, overcapacity has become a sword of Damocles hanging over China's photovoltaic head.
According to industry insiders, China's PV overcapacity has led to oversupply in the market, and "good products sell at the price of cabbage".
Excessive price spelling is not "involution", but "internal friction".
Without reasonable profits, photovoltaic companies can only reduce costs to survive, and scientific and technological research and development will be unsustainable.
Photovoltaic base in Xinjiang
In the long run, the mainland's photovoltaic industry may be damaged by internal friction and vicious competition.
A business that competes in an orderly manner is sustainable.
At present, Continental has formed the world's most complete industrial chain from industrial silicon, high-purity silicon materials, silicon ingots/silicon ingots/silicon wafers, cells, modules, inverters, photovoltaic auxiliary materials and accessories, photovoltaic production equipment to system integration and photovoltaic product applications, and has cultivated a number of world-class leading enterprises.
Looking at the world, the protective wall of the mainland photovoltaic industry has been built high, and it is almost impossible to find opponents.
The greatest enemy may be ourselves.