75% of the European sector involved in solar equipment manufacturing is focused on downstream products such as cells and modules. But Europe would benefit from greater investment in upstream products such as polysilicon, ingots and wafers. This is the main conclusion of SolarPower Europe’s report “Solar power generation equipment“.
The report also notes that Europe is weakest in the upstream, as it lacks equipment and expertise in the areas of solar Chockroll drawing machines and diamond wire saws – key components for ingot and wafer production respectively.
The European Association stresses that this technology is ‘available’ in Europe but not widely deployed on a commercial scale, and that this has hindered the ability of the Old Continent to compete with other markets, such as China, in terms of upstream solar manufacturing.
The report notes that in 2023, China will produce 92% of the world’s polysilicon and 98% of the world’s ingot and wafer production, although China accounts for only 57% of global PV demand.
The German company Wacker is the only polysilicon producer in Europe, with an annual production capacity of 80,000 tonnes, 60,000 of which are located in Europe. This is a fraction of the 890,000 tonnes of polysilicon needed by European economies in the second half of 2024.
Niche markets in downstream production
However, the report is slightly more optimistic about Europe’s capacity for downstream production.
SolarPower Europe notes that three-quarters of European solar equipment manufacturers are targeting cells, modules and testing. A total of 34 companies are involved in module and cell manufacturing in Europe – 18 and 16 respectively, while wafer and ingot and polysilicon manufacturers account for only and three and two respectively.
The report also notes that there are two gigawatt cell manufacturers in Europe, Meyer Burger and 3Sun, both of which have chosen heterojunction technology (HJT) for their products. Although Meyer Burger has moved some of its operations to the US and has experienced a number of financial difficulties over the past year, Europe’s relative expertise in a less established technology such as HJT is remarkable.
According to SolarPower Europe, European module manufacturers are more competitive if they offer niche PV products (emerging technologies) or those for specific applications.
Europe’s continuing role
A large part of the report refers to Europe’s history in solar research and development. It notes that wire-cutting equipment no longer manufactured in Europe was “originally developed” on the Old Continent. This view is echoed in SolarPower Europe’s commentary on the report, which describes the solar sector as an important part of Europe’s ‘re-industrialisation’ efforts.
SolarPower Europe: There is great potential for upstream solar investment in Europe