How Europe can become the Solar Valley of the world

The most efficient solar modules are created in Europe but built elsewhere – that must change if the bloc is to establish itself as a serious solar competitor
Solar panels being installed in western Germany | Photo: Alamy

By Michael Bloss

Michael Bloss (DE, Greens/EFA) is a member of the Committee on the Environment, Public Health and Food Safety and the Committee on Industry, Research and Energy

13 Mar 2023

I still remember the day when my eighth-grade teacher gave in to our request to install solar panels on the school roof. I was 13 years old at the time, and the energy transition in Germany was still mostly a foreign concept, because coal, oil and gas kept our economy humming and supplied my school and home with electricity and heat. Renewables were exotic.

But since Russian President Vladimir Putin invaded Ukraine and the devastating effects of the climate crisis have become more obvious, it should be clear to us Europeans that renewables are now the norm – the time of cheap and climate-damaging fossil fuels is over.

The United States and China have recognised this. They are fostering their domestic solar and wind power industries with billions in investments. Since the US introduced its Inflation Reduction Act (IRA), new solar factories have been announced almost weekly in the country. And China has been promoting solar power for years: it is home to seven of the world’s top 10 solar manufacturers.

What was a highlight at school for me 23 years ago has long been a part of everyday life in China and will become the new normal in the US with the IRA. In 2022, more than 85 gigawatts of solar capacity were added in China – twice as many as in the EU.

These numbers probably cause more concern than joy in the EU Commission. Yes, this development is good for climate protection around the world, but the question remains what role the EU is playing. So far, hardly any.

Now Commission President Ursula von der Leyen is responding to pressure from business interests, energy shocks and industrial policy news. The Net Zero Industry Act is probably Europe’s last chance to establish itself as a serious solar competitor. We have the knowledge to do so. The most efficient solar modules in the world are created here, in Europe, but are built elsewhere. That makes us dependent.

If China continues to be serious about stopping the export of important materials for solar production or even entire solar modules, this would be the end of the European energy transition and thus our independence. Every additional solar factory becomes a question of European security.

In order to be able to build domestic solar factories, and fast, three important steps are needed. First, accelerated approval processes. Building a factory in Germany or France sometimes takes years. Just as the construction of renewables is now an overriding public interest, the same must apply to those very same construction projects for solar factories.

We want solar factories back in the bloc

At the same time, Europe must make a clear decision: we want solar factories back in the bloc. Shying away from making an industrial policy would be naïve in view of the great efforts in China and the US to build the key technologies of the future.

And thirdly, probably the most important building block: fresh money. Those companies that announce their investments in the US this year can count on strong subsidies under the IRA. To avoid intra-European competition, we should create a common investment pot that clearly says, “If you build a solar factory, we’ll help you, but we want a pan-European value chain.”

What was then a weeks-long struggle in my school to get a few solar cells on the roof should happen in a rush every day across the bloc with “made in Europe” panels. This would give us the chance to set new standards and to become the Solar Valley of the world.

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