Nationality, skin colour and race must not influence judgment or treatment. What for people in an enlightened democratically organized society is considered, if not a matter of course then at least decidedly desirable, has not applied to PV panels for quite some time.
Intrinsic value should, of course, be considered far more important than origin. Applying this principle to cells and modules, production quality should be the ultimate evaluation criterion. Quality is decisive for both future energy yield and the longevity of a PV installation. Price and availability are also very important for profitability.
In reality, however, origin unfortunately plays a very decisive role in the evaluation both of people - the current refugee problem is a case in point - and solar modules. We Europeans, and also Americans have a fear of being overrun by cheap foreign labour (or cheap modules) which could threaten or even destroy our domestic economy. At the same time, there is plenty of demand for both of these resources. And yet, we rarely pay attention to qualifications or quality. What we always recoil at is origin and apparently unlimited availability.
The European solar market requires large quantities of high-quality, low-cost modules. Chinese producers could satisfy this demand. Nevertheless, the European Union has been preventing them from meeting the urgent need for modules for nearly four years. This has massively obstructed market development, in particular the value chain downstream of the manufacturer. International meetings of the largest economic powers cynically pledge on a regular basis to lift trade barriers and end protectionism. This happened again recently at the G20 summit in Hamburg. Yet the result is mostly conciliatory words - no decisive action is taken.
Of course, at the same time, rules have to be established to ensure fair competition is possible and that local standards do not suffer. No one in the EU is happy with poor-quality modules, even if they are liquidated at fire-sale prices. Admittedly, there will always be a couple of players that also buy such goods, but they generally know what they are getting into. But all of the major Chinese producers work to very high technical standards. They can produce very good quality if given the chance and when it its demanded of them. And even when their products face strict quality requirements, higher degree of automation and economies of scale still make them less expensive than modules from the much smaller European production plants. The price difference is anything but huge, assuming equal quality, but in larger projects it is a decisive factor.
Based on the price dumping and unfair competition arguments, however, highly professional providers are essentially excluded from the EU market, while the gates are open to products from elsewhere in Asia, often with murky origins and dubious quality. The Chinese companies adapted to the new conditions very quickly, renting space in Taiwanese, Vietnamese or Malaysian factories and dialing back quality standards in order to hold their own against price pressure from the new players in the market. Meanwhile, the quality of modules on the market has nearly dropped below the level it was at four years ago, and problems with faulty new products are beginning to pile up.
Overall, the availability of solar modules across all designs and cell technologies is poor at the moment, which has led to a general stagnation in price development, which was previously heading south. On the one hand, there are simply not enough European manufacturers to meet the current rising demand on their own, particularly following the demise of the major supplier Solarworld. On the other hand, it is becoming more and more difficult to import Asian modules, even if the manufacturer is on the European Commission’s “white list”. Scarcely any Dutch providers still offer fiscal customs clearance for Taiwanese or Malaysian modules, as the liability risk is too great and the situation is currently too opaque. Dealers wanting to import such modules to Europe can often only do so with expensive detours through other customs warehouses outside the large ports and transshipment facilities. We have to stop this nonsense immediately.
I announced an end to the publication of an origin-based price index a year and a half ago. I justified this step by pointing to the increasing difficulty of establishing the provenance of individual modules at all - basically, nothing has changed in that regard. In addition, the diversity of market actors since then has significantly decreased. This month I am officially and demonstrably ending the compilation of module prices by regional origin - true to the sentiment and the title of this commentary.
Overview by technology of different price points in July 2017, including the changes over the previous month (The prices shown reflect average asking prices for duty-paid goods on the European spot market):
