Reallocate Financial Resources to Support the European PV Industry

Reallocate Financial Resources to Support the European PV Industry

Despite the EU’s efforts to promote the development of a European solar industry, some countries in the EU are hesitant to provide financial support. The Association of PV Manufacturers is calling on these countries to take advantage of the opportunities available to support the industry.

The European Union member states were prohibited from providing subsidies to the PV industry until recently due to strict requirements for state aid. However, this has changed with the introduction of the Green Deal industrial plan. The commission presented its legislative proposal in mid-March, and the parliamentary procedure is currently ongoing. In addition, there is a temporary crisis plan that allows support for green industries. The Association of PV Manufacturers is urging EU countries to take advantage of these opportunities and provide financial support for the development of a European solar industry.

Despite the availability of the REPower-EU program that facilitates start-up financing for green industrial production, not all member states of the European Union are willing to take advantage of it.

The European Solar Manufacturing Council (ESMC) is calling on countries to provide financial support for the development of a European solar industry. This appeal comes at an opportune moment, as national recovery and resilience plans are being revised and are set to be submitted to Brussels for approval by the end of April. The ESMC, an association of European companies and research institutes in the photovoltaics sector, aims to promote and support the European production of all components and primary products for PV systems.

The association highlights that some member states are not making full use of the opportunities presented by the European Commission in March of this year. The Temporary Crisis and Transition Framework (TCTF) is specifically designed to provide support for green industries (i.e., net-zero industries).

Boost the PV industry now – the EU has paved the way

The ESMC is calling on EU Member States to seize the opportunity to use REPowerEU grants to support the development of competitive photovoltaic manufacturing plants and drive economic growth. The association emphasizes the importance of taking advantage of the opportunities provided by the European Commission’s TCTF, which allows for the support of green industries, including photovoltaics.

ESMC has reached out to all EU member states at the start of March, urging them to allocate funds for PV production from the €20 billion REPowerEU budget. However, the response from EU member states has been mixed, with some justifying their refusal to provide funding with already-planned subsidies for renewable energy expansion. On the other hand, some member states have reconsidered their stance and acknowledged the potential benefits of supporting the development of a European PV manufacturing industry.

As there are currently no other sources of additional funding beyond the REPowerEU plan, utilizing the national recovery and resilience plans is the most straightforward and efficient approach to rapidly establish production capabilities.

The Green Deal Industrial Plan

In March 2023, the European Union unveiled the Net Zero Industry Act, aimed at promoting the development of industries that produce eco-friendly technologies. The act specifies a set of favored technologies:

  • photovoltaic and solar thermal systems,
  • onshore and offshore wind power,
  • biogas,
  • energy storage,
  • green hydrogen technologies,
  • grid expansion,
  • carbon capture and storage technologies.

The law lays out targets for capacity building and outlines measures to expedite approval processes. The objective of the Net Zero Industry Act is to prevent the migration of green industries that could benefit from significant tax incentives under the Anti-Inflation Act (IRA) in the United States.

The European Union aims to produce 40% of its green industrial products within its member states by 2030. Specifically, this means manufacturing components for 30 gigawatts of photovoltaic output within Europe. This would require a significant industrial restart for primary products such as silicon, wafers, and cells.