With solar forming a central pillar of Europe’s rapid transition to clean energy, re-shoring the solar supply chain to Europe is now as important to energy security as ending reliance on Russian gas. Yet a domestic skills shortage combined with a lack of industrial facilities and financial support has left the EU reliant on imports from China to fill the gaps in its domestic supply chain. And the potential energy security implications were recently exposed when China considered imposing an export ban on technologies fundamental to polysilicon wafer production.

The EU aims to achieve a 55% cut in greenhouse gas emissions by 2030 and as part of this the RePowerEU strategy envisions rolling out at least 600GW of new solar PV capacity by 2025. Yet a series of challenges have made the continent heavily reliant on imports, primarily from China, for its supply chain.

Europe’s industry has traditionally suffered from some major gaps in capital and operational expenditure and a lack of financial support and funding mechanisms in contrast to other regions such as North America. For example, the US Inflation Reduction Act (IRA) extended tax credits for their solar industry and will double the US solar power workforce and see a 69% increase in solar deployments. The US approach is bold and simple and offers an example that Europe could follow to support its solar industry.

Europe currently has a shortage of industrial facilities capable of producing at the required scale and speed. Meanwhile, huge layoffs across many companies after reductions in subsidies and feed-in tariffs in 2010 have created a solar skills shortage across Europe. And the bloc has yet to fully exploit its competitive advantage in producing sustainable solar technologies from low-carbon to fully recyclable designs.

Cumulatively this has resulted in over-reliance on imports with 98% of Europe’s ingot, wafer, and cell components and 83 percent of its module components currently sourced from China.

In response to this challenge and as a broader commitment to building a sustainable future for Europe, The European Solar PV Industry Alliance, spearheaded by EIT InnoEnergy, is now developing a comprehensive action plan that will include bold new strategies for re-shoring the solar supply chain to Europe. The alliance has grown to include over 110 members across 17 countries and is devising a roadmap to re-develop, de-risk and accelerate the PV industry in Europe across all segments of the value chain from silicon to modules. It includes four working groups dedicated to demand-side policies, supply chain, financing, and skills.

The plan aims to deliver the EU Green Deal’s ambitious target of developing a domestic industry that can supply 30 GW of solar a year by 2025, adding 60 billion Euros of new GDP every year and creating over 400,000 new jobs. Central to that plan will be developing a domestic photovoltaic solar energy ecosystem to diversify supply away from China. This will boost energy security and affordability while creating new domestic industries and jobs.

One working group will be identifying funding gaps in both capex and opex across the European value chain from equipment to materials, and propose new financing support and mechanisms. The group is also convening a special taskforce on funding the industry led by the European Solar Manufacturing Council.

A second working group will identify critical pinch points and gaps in the value chain from access to key equipment to industrial scalability challenges. This will include proposals to develop industrial facilities that can accelerate domestic production of critical components at the required scale. It will also propose new policy measures and mechanisms to strengthen weak parts of the value chain such as ingot, wafer and cell components.

The Alliance is also developing ways to capitalize on Europe’s competitive advantage in sustainable solar production. This could include creating ESG-based “best-in-class” categories for solar PV, emphasising areas where Europe is strong, such as design for recyclability and low-carbon designs. These could also be made a requirement for all imported products, compelling suppliers to compete on other criteria apart from cost.

One of our working groups is devising an ambitious plan to upskill and retrain workers from other industries to create 30,000 new solar workers across Europe by 2027. This will include identifying and synergising with similar European skills initiatives and programmes alongside the EU’s Pact for Skills and creating a new Solar Academy.

The full plan is set to be unveiled at this week’s Intersolar Europe conference. And the stakes could not be higher. Building a domestic solar supply chain could create new industries and skilled jobs while dramatically boosting Europe’s energy security and affordability and radically reducing emissions.