The Pushback Against China's Dominance in Solar Manufacturing
- The United States and Europe are taking steps to reduce their reliance on Chinese solar panels, which account for about 80% of global production.
- Concerns about China's unfair trade practices and the use of forced labor in its solar supply chain are driving this pushback.
- The U.S. has imposed tariffs on Chinese solar panels, and the European Union is considering similar measures.
- Some countries are also investing in their own domestic solar manufacturing capacity.
- India, for example, has set a goal of installing 175 gigawatts of solar power by 2022, and is providing subsidies to domestic solar manufacturers.
Chinese Vendors Dominate Supply Chain of Indian Solar PLI Scheme Winners
- Reliance New Energy Solar, Tata Power, and Adani Green Energy are among the companies using Chinese vendors.
- A majority of winners of India's PLI scheme have listed Chinese suppliers.
- The reason for this is that India's solar module manufacturing capacity is at a nascent stage.
- The PLI scheme aims to boost the domestic supply chain of solar power equipment.
- Around 70% of India's solar power generation capacity is built on China-made solar equipment.
- India has ambitious goals for clean energy, but fell short in 2023 due to policy issues, politics, and supply chain challenges.
- The country only installed 13.7 GW of clean energy in 2023, compared to a target of 16.3 GW.
- Experts say India can make up for the shortfall in 2024, but warn that more needs to be done to meet long-term goals.
- Some key challenges include:Fluctuating import taxes on solar modules Incentives for domestic manufacturing that conflict with installation goals Fossil fuel lobbying Lack of ambitious clean energy targets
- Despite these challenges, there are reasons to be optimistic.
- A sharp rise in solar module imports toward the end of 2023 suggests that many delayed projects will soon be completed.
- The government has issued a slew of new tenders for renewable energy projects.
- India has a large pool of talented entrepreneurs and innovators in the clean energy sector.
- If India can address the challenges it faces, it has the potential to become a clean energy powerhouse.
