Market Trends

Spike in Europe's solar power demand met by China

Domestic renewable manufacturers aim to 'actively grasp the opportunities' after witnessing rise in orders, global share

Chinese renewable manufacturers are likely to witness a boost in orders from the European market as the continent is planning a faster transition to clean energy to replace fossil fuels, said analysts.

As a plan to rapidly reduce dependence on fossil fuels, Europe will ramp up wind and solar power installations, doubling solar photovoltaic capacity to 320 gigawatts by 2025 and installing 600 GW by 2030, according to the REPowerEU plan announced by the European Commission in May.

The increasing demand for solar power will certainly provide more opportunities for solar companies in China, the world's top solar manufacturer, said Luo Zuoxian, head of intelligence and research at the Sinopec Economics and Development Research Institute.

Chinese solar companies are already witnessing a rise in orders from Europe while expressing an optimistic outlook for the European market this year.

LONGi Green Energy Technology Co, a world-leading solar company, said Europe is the second-largest market for the Xi'an, Shaanxi province-based company, only after the domestic Chinese market.

During the first quarter this year, the company saw 27 percent of its 6.44 GW component shipments go to Europe after China, which accounts for 32 percent, it said.

The company saw its share of component products in Europe reach 28 percent last year, and it aims to "actively grasp the opportunities brought by the growth of European market demand and further expand its presence in Europe in 2022".

Solar company Risen Energy Co Ltd has also long been laying out plans for Europe for years, including France, Poland and Spain, eyeing its massive potential for solar resources. It expects local installed capacity to further surge this year, thanks to local policies.

Customs data showed China's exports of solar components to Europe during the first quarter rose to 16.7 GW, 145 percent higher compared with the same period of 2021 with 6.8 GW.

During the first five months, the figure was 34 GW, up 129 percent year-on-year. Europe is the overseas market for domestic solar companies that has witnessed the most drastic growth during the past five months, it said.

Jiang Yali, a solar analyst at BloombergNEF, said Europe's solar market is quite positive. Surging energy prices are driving large-scale utility installation, and residential markets are also boosted to replace gas in the energy supply mix.

"Currently, more than 90 percent of solar component supply in Europe comes from China, leading to consistent surging exports of Chinese solar components, even though raw material costs have also been climbing," she said.

"Manufacturing capacity in Europe is relatively small in scale, and it can rely on China in the short to middle term."

Jinneng Clean Energy Technology Ltd, or Jinergy, a PV manufacturer and clean energy provider in China, also reported increased orders from overseas, and it vows to further expand its presence in Europe.

Europe has long been the focus for Jinergy. The company's products are currently being exported to more than 10 European countries including Switzerland, Finland, Italy and Germany, it said.

Zhang Kun, executive president of GCL System Integration Technology Co Ltd, a Chinese operator of clean energy projects, also expressed confidence in the European market in 2022, saying with demand for photovoltaic products including inverters and other components exceeding supply, spot prices are expected to rise 3 to 5 percent compared with future products.

Zhang Yong, president of AISWEI Technology (Shanghai) Co Ltd, a manufacturer focusing on clean energy with a broad portfolio of photovoltaic inverter products, EV chargers and a smart energy management system, said the company has been replenishing products in the European market recently, which are sold immediately when shipped to local warehouses in Europe.

According to Luo, European countries have been stepping up energy supply capacity amid the gas shortage last year and the Russia-Ukraine conflict this year, either by resorting to fossil fuels and nuclear energy or stepping up new energy development. China, as a major solar and wind power equipment manufacturer and exporter, will play a key role in meeting the demand.

Chinese companies have long been dominating solar manufacturing, accounting for nearly all global production in some steps of the supply chain. Nearly 40 percent of its solar exports went to Europe in 2021, according to BloombergNEF.

This is against the backdrop of booming renewable energy development in the home market.

In recent years, China has been stepping up the development of renewable energy, including solar and wind power, with massive achievements in the sector as the country aims to peak carbon dioxide emissions by 2030 and achieve carbon neutrality by 2060.

The country will see its installed capacity of renewable energy account for more than half of the country's total by 2025, from 42.4 percent (930 million kilowatts) by the end of 2020, according to the National Development and Reform Commission, the country's top economic regulator.

The government also vows to generate 3.3 trillion kilowatt-hours of electricity from renewable energy by 2025, and its total renewable energy consumption will equal 1 billion metric tons of standard coal by then, it said.

Luo believes high oil prices worldwide will only further stimulate the already strong momentum.

On the other hand, solar manufacturing costs in China are also 35 percent lower than in Europe, 20 percent lower than in the US, and 10 percent lower than in India, according to data from the International Renewable Energy Agency.

In the eight years from 2010 to 2018 alone, the cost of electricity from utility-scale solar photovoltaic projects plunged by 77 percent thanks to Chinese manufacturing, while the world's solar capacity grew at a compound annual growth rate of nearly 43 percent over that period, it said.

Morgan Stanley estimated that Europe's drastic increased demand for solar power could translate to a 15 percent boost in overall Chinese solar exports over the rest of the decade as Europe's increase of solar capacity is nearly double what it was expected to add.

Jiang also warned of the potential risks and uncertainties due to the geopolitical situation and the potential non-trade tariff barriers posed to Chinese solar companies.

Luo agreed, saying Chinese solar companies should act with caution and avoid potential excess production capacity.

European countries are in the middle of an intense adjustment period under pressure to cut oil imports, he said.

Most Viewed in 24 Hours


Start a Digital Twin Journey from Engineering Simulation

Accenture releases survey of digital transformation

CIMC Reduces Unplanned Downtime by 30% with Greater Operational Insight from ThingWorx

Ansys Simulation Speeding up Autonomous Vehicles

  • Tel : 0086-27-87592219
  • Email :
  • Add: 3B1 International Business Center, No. 18 Jinronggang Road (No.4), East Lake High-tech Development Zone, Wuhan, Hubei, PRC. 430223
  • ICP Business License: 鄂B2-20030029-9
  • Copyright © e-works All Rights Reserved