The report, “Reshoring Solar Module Manufacturing to Europe”, presents a cost gap analysis and policy impact simulation. It finds that producing a solar module in Europe using EU-made cells costs around 10.3 €ct/Wp more than manufacturing the same module in China.
The gap is driven by higher costs for equipment (up by 40 %), buildings and facilities (110 %), labour (280 %), and materials (50 %). As a result, utility-scale solar installations using EU-made modules cost around 60.8 €ct/Wp, compared to 50.0 €ct/Wp for Chinese systems. This translates into a Levelised Cost of Electricity (LCOE) that is 14.5 % higher for European-made modules, which is still within the 15 % additional cost threshold allowed under the Net-Zero Industry Act auction rules.
Significant cost difference
However, the report highlights a significant cost gap ranging from 2.2 to 5.8 €ct/Wp between NZIA-compliant modules made in the EU and those produced outside Europe. While the Net-Zero Industry Act’s resilience criteria can help diversify supply chains and increase imports from other regions, the study warns that without additional policy support, reshoring solar manufacturing to Europe remains unlikely.
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Crucially, the report shows that the cost gap between European-made and Chinese-imported solar modules can be reduced to below 10 % with the right policy mix. This includes combining CAPEX and OPEX support schemes for both manufacturers and project developers, along with output-based incentives. Similar models have proven effective in the US (IRA) and India (PLI schemes), assuming factories reach capacities of 3–5 GW.
The report notes that annual industry support of €1.4 to 5.2 billion will be needed to reach the 30 GW target for European solar manufacturing by 2030. Up to 39 % of these costs could be offset through macroeconomic benefits, including up to 2,700 jobs and €66.4 million in annual tax and social contributions per GWp of annual capacity.
Recommendations
1. Establish an EU-level output-based support scheme for solar manufacturing that combines grants, loans and de-risking instruments to cover both CAPEX and OPEX.
2. Implement NZIA policy schemes across Member States, including “Made-in-EU” bonus points in rooftop support and public procurement programmes.
Expert view – China signals the end of rock‑bottom solar prices
“This new report underlines that, with the right policies, Europe can competitively deliver 30 GW 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. To meet the 2030 goal, the EU and Member States must act swiftly. Without intervention, Europe risks losing its remaining industrial and technological capabilities in solar,” said Walburga Hemetsberger, CEO of SolarPower Europe. (hcn)
