High material costs kept prices in the PV supply chain high. Yet, global solar demand continues to rise due to accelerated energy transition and energy short supply caused by international conflicts. According to China Customs data, InfoLink found that China exported 14.4 GW of modules in May, a 95% YoY increase. During the January-May period, the cumulative export volume reached 63.4 GW, a 102% YoY increase, indicating strong demand.
From a geographic perspective, each continent saw significant growth and posted more than 40% of increase comparing with the corresponding period last year, as evidenced by the module export data dated from January to May. Except India, where the introduction of basic customs duty caused bigger change in import volume, demand from other markets remained stable, and even increased month over month in Europe.
Driven by energy transition needs accelerated by the Russia-Ukraine war, Europe imported 8.9 GW of modules from China in May, a YoY increase of 146%. The continent accumulated 33.3 GW of module imports during the January to May period, increasing by 144% YoY, the highest among all markets. Last year, Europe also imported the largest volume, at 40.9 GW, accounting for 46% of total Chinese module exports. The month-over-month growth this year points to Europe’s strong demand for solar products.
As of the end of May, seven countries in the bloc have each imported more than 1 GW of modules from China. The Netherlands, the major transport hub in Europe, accumulated 16.5 GW of module imports, a 100% increase from the same period last year; the country was projected to have 4 GW of module demand. Germany and Spain, the second and third largest market in Europe, imported 2.1 GW and 4.7 GW of modules, respectively, a twofold increase. Germany and Spain are expected to see demand reach 7 GW this year. Countries including Poland, Greece, Portugal, and France, which was projected to see demand surpass 1 GW, has each exported more than 1 GW of Chinese modules so far.
While Europe’s import volume continues to increase and even exceed the projected module demand of the year, actual installations fell behind imports. Possible reasons behind this phenomenon are that the pandemic-induced logistics disruption taking place over the past months in China caused shipment delays overseas, PV installation work is impacted by inverter and labor shortage, and Tier-1 manufacturers with business focusing on Europe increased their stocks strategically, leaving some of the modules in the inventory. So, there’s a difference between import volume and actual installation.
Although actual installation volume is not as high as import volume, the European market will remain the market outside of China with highest demand for Chinese products. And as Europe’s legislative framework supporting renewable energies set clear goals, such as Germany’s Renewable Energy Act (EEG), which set a target of achieving a total solar capacity of 215 GW of by 2030, annual solar additions at 18 GW as of 2025 and solar installation to grow by 22 GW annually as of 2026, Europe will remain a major export market of China in the years to come. In light of this, InfoLink revised up the full-year module demand of Europe to more than 55 GW, and the figure may even reach beyond 65 GW under an optimistic scenario.