L R AS Published on Monday 19 February 2024 - n° 476 - Categories:PV Watch
A look at two photovoltaic reindustrialisation studies (in France and Australia)
PV Magazine has published three articles on the state of the French photovoltaic industry. They take stock of the strengths and weaknesses of the current situation. And they don't forget to mention the procrastination of the Brussels authorities.
This week, the Australian Photovoltaic Authority presented the results of its study on the relaunch of PV industrialisation in that country. The approach is completely different.
It is interesting to compare the two approaches and to see the weakness or inadequacy of the French position.
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Summary
Gigafactories will be able to rely on French research: the revival of the French PV industry seems to be able to count on research institutes
Should wefavour European products that are twice as expensive or favour Chinese products that are destroying European industry? Lobby groups are actively lobbying the European Commission. The Commission has been unable to decide between the two positions, which has led to a measure (the NZIA) that does not really satisfy
The Australian analysis: common sense: faced with this European difficulty in deciding, the analysis of the Australian authorities is clear. To get a PV industry in Australia, you have to agree to finance it on a long-term basis
The weakness of the French analysis: It's not just about research to combat Chinese products, it's also about building up a prosperous business. You need impeccable organisation to set up quality production. You need the financial resources to set up the business and then to keep it going for several years. No information is provided on this subject as if it were not important
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The text:
PV Magazine devotes three articles to the photovoltaic industry and its revival (see end of article). At the same time, the Australian Photovoltaic Authority (ARENA is tackling the same subject in a completely different way, but with the same objective: to study the rebuilding of a photovoltaic industry.
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Gigafactories can draw on French research
The French study focuses on technical expertise and collaboration with research institutes. To a certain extent, it indicates that French photovoltaic research is advanced, and that it can improve its discoveries to make them available to industrial companies.
The study also mentions French structural difficulties and shortcomings, such as the importance of research at LONGi, the variety of aspects studied and the age of investment in research and development, but also the subsidies available to French companies.velopment, but also the subsidies and other financial advantages granted by the Chinese government to its companies, the fall in the price of panels sold in Europe to half the production price in Europe and a quarter below the Chinese production cost.
As a result, the director of the solar technologies department at CEA-Liten lets slip a "the battle is far from lost", indicating a lack of frank and massive optimism about the large factory projects. He explains his doubts by saying that we need to be "more creative and find new ways of differentiating ourselves".
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Should we favour European products that are twice as expensive, or Chinese products that are destroying European industry?
More serious is the lengthy discussion of the incomprehension of the political authorities in the face of the worsening economic and therefore financial situation of manufacturers. They are under pressure from stocks worth 800 million euros, which they are unable to sell. This is because these products are twice as expensive as the panels available on the market. The article highlights the difficulty in understanding the situation, or rather the hesitation and inability to decide between favouring European manufacturers even if it means The article highlights the difficulty of understanding the situation, or rather the hesitation and inability to decide between favouring European manufacturers, even if it means that the prices of their panels are more expensive but locally produced, or adopting SolarPower Europe's proposal, which prefers cheap Chinese panels, even if it means destroying the European industry.
The overview of the French study is rather good, because it highlights the contradictions, the opposition and the difficulties the authorities have in making choices. The authorities believe that with the NZIA they have solved the long-term problem of the European renaissance, but all they have done is create a smokescreen for the future: manufacturers will be able to have 30% of their products reserved, but in addition to having to exceed the 6 GW of public tenders (private tenders are not affected and public tenders are not included in the NZIA), they will also have to exceed the 6 GW of public tenders (private tenders are not included in the NZIA).private tenders are not affected, and tenders of less than 6 GW are not covered by this allocation guarantee), only Chinese manufacturers will be winners. As it will take two to three years for the NZIA to reveal its qualities or defects, many companies will be liquidated in the near future without the authorities even realising the reasons for their demise.
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The Australian analysis: common sense
Faced with the same problem, the Australian situation is quite different. Rather than congratulating themselves on Australia's technical skills, which are recognised by a number of relevant innovations, they look at the difficulties ahead: they point out that it is not enough to set up manufacturing units, but these units must also be able to operate on a break-even basis, while the Chinese will continue to supply the market at prices that are so low as to make operating subsidies untenable. ARENA points out that the production units will have to be replenished over several decades.
This is where the judgement and relevance of the Australians are remarkable. In the two projects (Holosolis and Carbon), there is no indication of the construction budget for the gigafactory, the pre-launch expenditure (hiring, purchase of machinery, creation of a sales network, funding for research and development, even though it is public establishments that provide the results) or the cost of the project itself.There's no indication of how long it will take to reach break-even point, and no forecast of the cost of production or how this compares with the price obtained by the Chinese (12 ct per Wp). Is it because they don't want to frighten people that no figures are given? Is it because the directors have not put a figure on their projects because there are too many unknown factors (which would be understandable)? Do they hope that customs duties will protect the operation of the two gigafactories? Last but not least, do the leaders have enough funding to last five, ten years?
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The weakness of the French analysis
It is curious that the three countries that have started to build (or rebuild) an industry - Turkey, India and the United States - have resorted to customs protection! Aid and subsidies! Clearly, customs protection is not enough to get production units up and running. Clearly, developers and installers want cheap products in order to find customers. So why not subsidise European manufacturers after protecting them with customs duties so that their prices can gradually adapt to those of Chinese imports? We need to allow time for existing small businesses to grow and reach critical mass. It takes time to set up new teams, new sales networks and to develop new technologies. This is expensive. We also need to make sure that Chinese manufacturers don't disrupt the emergence of these European companies with dumping prices and an abundance of
products. of the current European Commission make it impossible to envisage a practical, reasonable and sustainable solution for rebuilding the European photovoltaic industry. We have to wait for the next Commission, in ten months' time, to take a fresh look at this crisis in the photovoltaic industry. Let's hope that the practical and concrete aspect will be its main features!
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Articles from PVMagazine :
1st article, Can large factories prosper in Europe?
