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New Energy World™
New Energy World™ embraces the whole energy industry as it connects and converges to address the decarbonisation challenge. It covers progress being made across the industry, from the dynamics under way to reduce emissions in oil and gas, through improvements to the efficiency of energy conversion and use, to cutting-edge initiatives in renewable and low-carbon technologies.
Europe’s solar dilemma: Competing with China while securing energy independence
26/2/2025
8 min read
Feature
In the early 2000s, Europe was at the forefront of solar PV production. However, as governments scaled back subsidies and incentives, they failed to compete with China’s state-backed manufacturing surge. Since 2011, China has invested over $50bn in new PV supply capacity – 10 times more than Europe. Making a dent in China’s production monopoly will be immensely challenging. But the EU could maintain leadership in solar installation and technology by strategically directing funding and diversifying supply chains, for example in the bloc’s upcoming Clean Industrial Deal, writes Charlie Bush.
Solar is the fastest-growing energy technology ever. Its meteoric rise from generating less than 0.2% of global electricity in 2000 to 5.5% in 2023, according to the International Energy Agency’s (IEA) World Energy Outlook, continues to gather momentum. In 2022, the world added more solar capacity than all other electricity sources combined, reports the International Energy Forum (IEF). By 2024, 593 GW of solar capacity was installed – 29% more than in 2023 – surpassing most industry forecasts, says Ember.
Huge leaps in PV panel efficiency – from 6% in the 1950s to 24.5% today – have driven this progress, according to the IEF. Alongside that is a reported 83% drop in installation costs per Watt, from $5.12 in 2010 to $0.88 in 2022. Since 2020, solar has been the cheapest source of electricity generation worldwide, according to the IEA.
China undoubtedly leads in the solar space. Government policies and individual entrepreneurship have helped Beijing to control over 80% of global capacity across all solar manufacturing stages, such as polysilicon, ingots, wafers, cells and modules today. This figure rises to 90% if capacity in south-east Asia owned by Chinese corporations is included, notes the IEA. China’s expertise in mass manufacturing and technological innovation has also driven down global prices.