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A new study proves it: If the size is right, Europe is once again competitive in the production of solar modules, too - and entirely without subsidies. But it needs to be at least a five-gigawatt factory in order to be profitable.

By Ralf Heimann

If Christian Knechtel wants to see a new machine produced by his company at work, he first has to embark on a long journey: Von Ardenne GmbH from Dresden builds machines for the manufacturing of solar cells. However, since the last German module manufacturer Solarworld went bankrupt in 2018, photovoltaic production has almost exclusively taken place in Asia. The production capacity there is around 150 gigawatts, compared to roughly two gigawatts in Europe.

This is not a satisfactory situation for German mechanical engineering companies such as Von Ardenne. "We no longer have any customers in Europe where we can test and optimize our machines," comments Knechtel. He explains that it's not just the distance that is the problem: Linguistic and cultural barriers are also an impediment to collaboration, especially as technical requirements make precision essential.
The consequences for the research landscape are also predictable. "At the moment, the main beneficiaries of European research funds are companies in Asia. Europe only profits again after the finished solar modules are sent back," says Knechtel.

In the medium term, the institutes in Europe will receive considerably fewer research contracts if the current research results are commercially exploited for the construction of new plants. A new dependency would arise, even though the technological expertise also exists in Europe.
The only solution for the two problems would be to have production facilities in Europe again. Dr. Stefan Rinck, Chief Executive Officer of Singulus Technologies AG in Kahl am Main, which produces machinery for manufacturing solar cells, believes this is necessary for reasons relating to industrial policy alone. "If Germany does not want to become dependent on foreign production and wants solar cells to be available for sustainable and independent energy generation, conditions must be created under which a domestic industry can develop," he comments.

The Fraunhofer Institute for Solar Energy Systems (ISE) has investigated the prerequisites for this on behalf of VDMA. The recently published study revealed that solar modules could once again be produced in Europe at competitive costs and without state subsidies.

The ideal and most cost-effective scenario would arise when a closed-loop supply chain for the most important materials is established in Europe and production takes place in a European country with comparatively low labor costs. From here, solar modules made in Europe could also be sold to neighboring regions.

The condition for this would be a production capacity of at least 5 gigawatts per year, corresponding to one-thirtieth of the production capacity currently installed worldwide of around 150 GW. Such a factory would require investment of more than one billion euros and would create several thousand new jobs both directly and indirectly.

Production facilities in Europe would also contribute to climate protection, as German companies are currently dispatching their machinery to Asia and the manufacturers there are shipping the finished cells and modules back to Europe. Dr. Jutta Trube, Head of VDMA Photovoltaic Equipment, believes this situation is untenable: "If solar cells and modules were produced in Europe, CO2 emissions could be reduced to a minimum and the energy system made more sustainable due to the circular economy." She adds that policymakers could support this process with sensible framework conditions such as suitable expansion corridors or an appropriate grid infrastructure.

The European market for solar cells offers good conditions for domestic production: This market grew by 68 percent (3 gigawatts) in Germany alone in 2018. Furthermore, the SolarPower Europe industry association expects annual growth of more than 5 gigawatts up to 2023.
Knechtel hopes that the study will trigger a discussion: "We now have facts and figures that back up our argument."

Rinck also believes that the paper paves the way for a general discussion, but is only cautiously optimistic. He is still missing a clear commitment to solar energy on the part of legislators. "We want to move on from coal, but we still have not been told where the electricity is supposed to come from. We only really have solar and wind left," he says. He feels that the study is a good tool, but it will not be enough to trigger a rethink on its own. "That needs to come from above."

Further Information


Jutta Trube, VDMA Photovoltaik Equipment.