I’m writing this dispatch as the news comes in on the wires about the decision made by thin-film PV giant First Solar to walk away from its German factories and “indefinitely idle” four of its 24 production lines. To put it bluntly, the blood is continuing to spill across the European solar sector.
First Solar’s facility in Frankfurt will cease production by the end of October and close permanently by the end of the year in response to ever-waning support for PV in core European markets. And of course, recent reductions in German and Italian feed-in tariff rates continue a trend intensifying across the Continent and “will have a dramatic impact on demand, as the vast majority of the European market is not viable without significant subsidies”, First Solar chief financial officer Mark Widmar says.
Meanwhile, other “personnel reductions” taking place in Europe (and indeed, the US) will see First Solar dump 2,000 of its workers – or 30 per cent of its global total as the company seeks to reduce operating expenses from 17 per cent of revenue to about 8 per cent. Production capacity will be reduced from 2.5GW to 1.7GW. The roster of German PV companies either filing for bankruptcy or shutting factories grows longer by the week, and of course, these recent announcements represent a major blow to the company’s PV manufacturing sector, which is already proving tough.
Naturally, we’ve covered the story in depth in this issue, but that’s not to say that we’re focussing solely on the negatives. Europe has long been the world leader in developing solar PV energy on a commercial scale but is now facing increased competition from other regions in the world as the industry globalises. We look at the options available to us that will enable our front-runner advantage, including the EPIA’s proposed industrial policy that would encourage and strengthen further local investments. It’s true that Europe needs a strong industrial base to remain competitive in the global economy.
