Catching a sunbeam: how the solar panel business is developing in Europe

In 2019, the EU's production of energy from wind and solar exceeded coal production for the first time. The development of the solar panels business is progressing by leaps and bounds. In just the last 10 years, the price of installing solar systems has fallen by almost 80%. The Institute for the Development of Fuel and Energy Technologies (IRTTEK) analyzes how the solar panel market is developing in Europe.

The ever-changing climate commitment legislation in Europe continues to have a positive impact on the PV market. And in general, it would not be easy to make a significant breakthrough in reducing emissions without them. Over the past 10 years, solar PV systems have reached technological and market maturity and are poised to lead the EU's efforts to meet energy and climate plans.

The growing popularity of panels has already affected the daily life of Europeans. Firstly, savings can already reach 50% of the electricity bill today. For a small house, three or four panels are enough, and for large houses, as a rule, about 12 panels.

The service life of modern panels is 20 years. Europeans who know how to count money treat their installation as a profitable long-term investment. Still, climate change does not yet affect life and wallets as much as the electricity bill at the end of the month. So in this case, even the biggest critics of climate change are unwittingly involved in the process, buying panels out of a desire to save money.

For example, in sunny Spain, savings on electricity bills over 25 years could amount to 27,425 euros. In this country, the sun shines for almost 3,000 hours a year, it is easier to save money than in the conventional UK or Sweden.

By the way, in Spain, subsidies are due to houses that install solar panels. Not only multi-apartment, but also private. Even a new and already popular profession of a panel installer has appeared. By the way, not as simple as it seems.

The demand for solar panel installers is on the rise. But many of those who decide to install panels on their roof make a popular mistake and try to do it on their own. As a result, the installation is incorrect, and up to 50% of efficiency is lost. It's about the wrong fasteners and the wrong location in the first place.

To provide guarantees, the Spanish Photovoltaic Union (UNEF) has created a special seal of quality for installers by establishing a certification system that ensures that the installation of self-consumption photovoltaic panels is carried out in accordance with all rules and standards.

Jose Donoso, Director General of the Spanish Photovoltaic Union (UNEF), a member of the IRTTEK Expert Council, believes that the problem of lack of experience in the sector exists and specialists should undergo special training and have certificates.

Spain installed 596 megawatts (MW) of new photovoltaic power for its own consumption in 2020, up 30% from 2019, according to UNEF data. Own consumption has made a huge leap forward. The surprise was the growth of the housing sector, which already accounts for 20% of the share.

Energy cooperatives

Across Europe, projects are being launched to build small solar power plants. Anyone can safely invest very small amounts and still make relatively high returns.

The movement is gaining momentum. In addition to providing themselves with a clean source of energy, members are usually entitled to dividends. But there is also a model where outsiders put money into these cooperatives and earn interest.

Running a business requires a lot of money and involves a number of risks. More and more people prefer to invest in real estate, but investing in energy cooperatives is more affordable.

Among the thousands of energy cooperatives springing up all over Europe, there are those in which it is possible to invest symbolic amounts and still make quite high profits from small photovoltaic projects. For example, Hyperion, one of the first such cooperatives, was created in Athens, and will return to its creditors a good 6% per annum on its loans.

Members of cooperatives have the right to withdraw from the project and receive their money back within three months.

Competitive fight

Until recently, most solar panels were made in China. China realized the importance of photovoltaic energy earlier than other countries and has been supporting the development of its solar industry in every possible way for more than a decade. Last year, 99 percent of all solar modules in the world were produced in Asia, the vast majority in China.

But the transport costs of delivering them open up prospects for domestic European production, for example in Germany. So far, European manufacturers enjoy much less support from their governments. However, more and more companies are now setting up their own modular plants to meet the growing demand for solar power systems in regional markets.

German manufacturer Solarworld lost a price war against Chinese rivals and filed for bankruptcy in 2018. However, the Meyer Burger company moved into the building of his factory in Freiberg, which is doing better so far.