Europe’s Solar Struggles

Welcome to The Strawman, the newsletter that’s like your favourite cereal - here for you every morning (and when you need it, for that late night climate-tasting snack). Damn, that’s tasty.

Today we're going to talk about the latest drama in Europe's solar power saga. It's like Game of Thrones, but with more sun and less dragons.

First, let's set the stage: Europe wants to ramp up solar energy production to break free from its addiction to Russian gas. The goal? To make solar the biggest energy source by 2030. That's fantastic, but there's a tiny problem. By tiny, we mean huge. 75% of the EU's solar panels come from China.

In a nutshell, Europe is trying to replace one dependency with another. And as we all know, dependency is not a good look on anyone. So, the EU's plan is to boost its own solar production. The issue with that is, currently, Europe produces less than half of what it needs.

So, what's the holdup? We've got three main challenges.

Politics

Europe wants to go local, but politics might get in the way of consumers getting access to the cheapest possible energy. Chinese solar panels are a bargain, but Europe is wary of relying on them too much. Europe’s not the only one relying on China though. They’re the only solar producer that exceeds their own demand for each of the main components in a solar panel (more on these in another newsletter).

Supply chains

For Europe to meet its own demands, it needs to overcome bottlenecks in the supply chain. Right now, there are only a few European companies that produce silicon ingots and wafers, essential for solar cell manufacturing. If Europe wants to go all-in on solar, it's going to need more than a couple of Norwegian companies to get the job done.

Investments

To catch up with China, Europe needs to invest in its solar industry like there's no tomorrow. But energy costs in Europe are much higher than in China, making it hard to attract investments. Basically, Europe needs to make it rain money on the solar sector, and that's easier said than done.

Now, what's the silver lining? (Or should we say "solar lining"?) Experts say that the challenges can be overcome, but Europe needs to speed up its game. The clock is ticking, and the EU needs to incentivise the re-industrialisation of solar production before it's too late.

So, will Europe manage to turn its solar ambitions into a reality? Or will it continue to bask in China's shadow? The Strawman’s keeping an eye on the Solar opera for you.

Until next time, keep it sunny-side up! ☀️