No turnaround in sight. This is the bitter conclusion, yet again, from a look at PV market development in May. Although prices of panels from all Asian regions rose again by one or two percentage points, German and European panel prices remained flat.
The fact that domestic manufacturers’ prices have held their own, apart from slight fluctuations, since October 2014 at an average of 60 cents per watt-peak is doubtless the result of the European Commission’s anti-dumping measures. Panels from other regions of origin are increasingly approaching this mark - but at what cost to the solar industry?
In light of the creeping decline in installations within the European Union, this development is anything but good news. With new PV installations in Germany falling short of the 100 MW mark for the third month running in April, according to the German Federal Network Agency, and due to continuously rising prices that point to no real market growth, May and June are likely to be just as catastrophic. Other European countries are not faring much better. The burgeoning interest from markets such as Poland and Greece is not nearly enough to offset the weak demand from the traditional PV markets.
At the same time, artificially inflated panel prices are not necessarily needed to protect European manufacturers against competition from China. German manufacturers, in particular, with their highly automated production facilities see themselves in a position to offer their panels at prices well below the current minimum import price and not lose money. However, most domestic manufacturers rely on cells from places like Taiwan, as European cell production capacities are too low to keep up with the module production rate. This allows them to swim comfortably in the pond without fear of being swallowed up by predatory Chinese competitors, which Mr. Asbeck and the EU Commissioners are culling in increasing numbers.
Meanwhile, the systematic effort to force Chinese companies out of the European market has now taken on almost absurd dimensions. Even those operating production facilities within the EU are forced to comply with minimum prices. The reasoning from the officials behind this is that it is now supposedly impossible to distinguish whether panels that end up on the European market are of Chinese or European manufacture, as long as they have similar specifications and the same branding. The up-shot of this is the closure of production facilities due to lack of product attractiveness and a complete withdrawal from the EU area. Now there’s an outstanding way to ensure further job cuts!
We should not expect a change in this trend any time soon - to the contrary. This is particularly true in light of the European Commission’s announcement that its investigation will continue, this time with a view to imports from Taiwan and Malaysia. Fewer choices, longer waiting times, higher prices - that is the unfortunate outlook for the coming months, which will almost completely rule out a much needed general market recovery in Europe. The UK is just one market that continues to be a source of good news. Once again, more than 1.6 GWp of capacity was added in the first quarter of 2015. However, to bring Europe back around to fair competition and positive growth, the alleged protectionism through market constraints must be abandoned. The plan has backfired.