A new report by SolarPower Europe and Germany’s Fraunhofer Institute for Solar Energy Systems (ISE) suggests that solar modules manufactured in Europe can become cost-competitive with Chinese imports if supported by targeted industrial policies.
The study, released this week, found that modules built with European-made solar cells currently cost about €0.103/Wp more than those produced in China. This translates into a 14.5% higher levelised cost of electricity (LCOE) for projects using EU-based products.
According to the report, utility-scale solar projects using European modules cost approximately €0.608/Wp, compared to €0.500/Wp for Chinese modules. Despite this, EU-manufactured modules already fall within the 15% LCOE threshold set by the Net-Zero Industry Act (NZIA) for eligibility in public auctions.
“With the right policies, Europe can competitively deliver 30GW of solar manufacturing by 2030, creating thousands of local jobs, and building a resilient, innovative solar supply chain that keeps economic value here at home,” said SolarPower Europe CEO Walburga Hemetsberger.
The report outlines that with a combination of capital expenditure (CAPEX) and operational expenditure (OPEX) support for both manufacturers and project developers — and assuming factory capacities scale up to between 3 and 5 gigawatts — the cost gap could be reduced to under 10%.
To scale the EU’s solar manufacturing capacity to 30GW by 2030, the study estimates annual industry support requirements between €1.4 billion and €5.2 billion. However, it notes that up to 39% of these costs could be offset through broader economic benefits, including job creation and local industrial development.
Among the recommendations are an EU-wide output-based subsidy scheme and wider implementation of NZIA policy tools across member states. These include incentives such as “Made-in-EU” bonus points for rooftop solar support programmes and public procurement processes.
The findings come as Europe aims to strengthen its energy security and reduce dependence on Chinese solar technology, which currently dominates the global market.
