Things are going bad for the German solar manufacturing industry, just as they have been for the U.S. one. The enemy are the low prices set by Chinese solar panels and their ever-growing piece of the pie.
Now at only 6 percent, the German solar industry once occupied some 20 percent of the global market, and the industry leaders are not at all optimistic. The solar panel manufacturers have had to deal with the greatest cost reductions of all the other industries.
Carsten Körnig, head of the German Solar Industry Association said “it has never been this bad” at Intersolar, the world’s #1 solar energy trade fair in Munich.
“The Chinese offer their customers a price that’s below cost. By doing this, the Chinese government forces the good, technologically advanced companies into a dire financial straights so they can ultimately monopolize the market,” said Frank Asbeck, manager of SolarWorld, quoted by Deutsche Welle.
This happens because Chinese manufacturers are receiving huge subsidies from their government to develop ultra-cheap solar cells for the fast-growing market. While this is creating the first of its kind revolution for solar power and allows more and more customers to go green by installing affordable energy producing devices, it drives established manufacturers’ sales to death.
On top of that, the subsidies for solar energy are decreasing, which leads to an even more reduced demand from the European market for locally-produced solar cells. “The funding rates have been halved in the last three years,” said Körnig. “No other technological sector has had to reduce its costs as much to keep up as the solar power sector.”
In the U.S., SolarWorld convinced the government to implement draconic taxes on solar cells imported from China, taking Solyndra’s collapse as one of the most convincing arguments. Solyndra had been heavily backed from the U.S. taxpayers’ money. Now, they want for the same thing to happen in Europe.
I know that from a financial standpoint imposing taxes and saving a sector of the economy seems fair, but if you think of consumers directly, it is not. I live in Europe, but I don’t care whether the solar cells I will put on my house will come from SolarWorld or from some Chinese manufacturer (again, from a financial standpoint).
And just like me there are millions of potential consumers. If SolarWorld can’t handle the low prices, let the Chinese produce solar cells, I don’t mind. Yes, it’s harsh and egotistical, but that’s the crude reality. The trade war should be centered on what the customer receives, and not on the survival of some unfit German company that has to deal with cost reductions.
It’s not China who brought Europe to recession and crying for the pity of European (German) solar manufacturers is like feeling sorry for oil companies not selling as much diesel as they did ten years ago, when the Chinese had almost zero solar cell production. But the facts tell that oil companies don’t have issues with money and moreover, they are naturally glad of the taxes imposed by various governments on Chinese solar panels, which ultimately deliver clean, limitless energy, as opposed to theirs.
Overall, the global economy and the global climate destabilized because of the greed characterizing the human kind: we just can’t seem to have enough of anything, and the ones having power fight over their interests which ultimately bring disadvantages to their own customers. In fact, lately it’s been awkward for prices to go down, and one can quote many reasons for that. The solar industry has actually seen this trend and its strange behavior leading to cheaper and cheaper power… and that is not ok to oil companies.
[via dw]
The US and many other nations have become “consumer nations” meaning that the ability to manufacture competively has become harder and harder. However each still believe that they should get a piece of the pie in some respects. Problem is we have priced ourselves out of the market. Evergreen is gone and many others will follow, not because we cant make the same thing here but because we cant do it without massive regulation and high labor costs. Face it people we priced ourselves out of the market. People in China are lucky to get what they need to survive, and they are greatful for what they get. I’m not saying working conditions in China are ideal but for the moment they are getting the job done and kicking everyones but. The key to taking advantage of the situation would be to stop digging a hole and buy the product from China for the greater good. Just think if our government would have spent the 879 billion on a solar installation in New Mexico….we would have created a lot of jobs for the installation but the better result would have been the reduction of greenhouse gases that everyone is screaming is destroying our planet. Trying to manufacture here in this country a product that we are not able to do cost wise was just plain stupid and was doomed to failure from the get go. Here is the last piece of the puzzle one must take into account….oil companies control the renewable energy market. When the price of oil goes up people look at renewables when it goes down the interest goes away. Our country can be energy independent at anytime it wishes to be….but we try to manipulate the world through what we use. If they wont do this we wont buy that or we will tax it. This does not help the people useing the product.
The spoils go to the person who can do the job cost effectively not produce the best product.
you’re so right, Joe… thanks for the comment.