Among countries joining the global bandwagon of energy transition, Europe is no doubt the most active market. Additionally, fossil fuel crunch resulted from Russia-Ukraine conflicts accelerates energy transition and boosts PV demand of the bloc. InfoLink’s investigation on China Customs data finds that, as of April, Europe has imported 24.4 GW of modules from China. Such figure is not only a huge YoY increase, but far higher than any other markets, making Europe the strongest source of demand for PV products other than China.
The European market
According to data compiled by InfoLink, China has exported 49.0 GW of module in the first four months of the year, among which 24.4 GW, namely 50%, headed to Europe, a significant 144% increase on the 10.0 GW of same period last year. Despite supply chain price hikes this year, the amount of modules China exported to Europe has not dropped, but increased monthly, indicating Europe’s robust demand for PV products.
To date, countries having imported more than 1 GW of Chinese modules include the Netherlands, Spain, Poland, and Germany. The Netherlands, as the transportation hub for many European countries, is the biggest importer, having bought in 12.1 GW of Chinese modules. Spain came in second with 3.3 GW of module imports from China. Other major buyers are Poland and Germany, having respectively imported 1.9 GW and 1.4 GW of modules from China.
Germany ramps up renewable energy development amid the Russia-Ukraine conflicts, aiming to fulfill 100% of its electricity need with renewables by 2035 and to add 20 GW of installed PV capacity every year from 2028 onward.
On May 18, the European Commission introduced the REPowerEU Plan, pledging to accumulate 320 GW of installed PV capacity by 2025, and 600 GW by 2030. The plan also mentions to step up scrutiny gradually, mandating all public and regular buildings to install rooftop PV systems. With supportive policy framework bolstering demand, Europe will continue to see strong upside momentum for its PV market in the coming future.
Europe posts vigorous order requesting activities despite elevated supply chain prices. Delivering prices rise on unfaltering strong demand and fluctuating exchange rates, coming in at USD 0.27-0.28/W for glass-backsheet modules rated beyond 500 W. Spot prices hold above USD 0.28-0.30/W amid great demand and short supply, as subject to pandemic-induced supply chain blockades in recent months. Residential distributed projects seawe USD 0.285-0.315/W of module prices. Prices for modules with black backsheets reach USD 0.295-0.35/W.
Europe has imported 24.4 GW of module from China during the first four months of 2022, with import volume seemingly increasing every month. Manufacturers all bode well for the European market. However, actual module demand may not be as much as suggested by China Customs data, given supply chain bottlenecks, such as chip shortage and unstable inverter supply. InfoLink puts forecast for Europe’s module demand this year at 49 GW, and 55 GW in the optimistic scenario.
Europe has a wider price acceptance. Doubled with issues regarding supply chain and trade barriers in the recent two years, the topic of local manufacturing has received heated discussions. SolarPower Europe and InnoEnergy proposed the European Solar Initiative, hoping to build a 20-GW PV supply chain, by 2025, from upstream to downstream sectors. Still, considering high production costs and longer times it takes to construct a complete supply chain, Europe still needs to rely on Chinese modules, making the bloc the hugest outlet for Chinese module makers of 2022.
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