Page 4 - AsiaElec Week 28 2022

AsiaElec COMMENTARY AsiaElec

IEA: the world needs diverse

solar panel supply chains

COMMENTARY
Global supply chains, currently heavily concen- demand, but this also offers opportunities for
trated in China, should be diversified, says the other countries and regions to help diversify
IEA in a new special report. This would help production and make it more resilient.”
ensure a secure transition to net-zero emissions. Meeting international energy and climate
Chinese industrial and innovation policies goals requires the global deployment of solar
focused on expanding solar panel production PV to grow at an unprecedented scale. This in
and markets have helped solar photovoltaics turn demands a major additional expansion in
become the most affordable electricity genera- manufacturing capacity, but the IEA said that
tion technology in many parts of the world, said this raises concerns about the world’s ability to
the IEA. develop resilient supply chains rapidly.
However, this has also led to “imbalances” For example, annual additions of solar PV
in solar PV supply chains, according to the capacity to electricity systems around the world
IEA Special Report on Solar PV Global Supply need to more than quadruple by 2030 to be on
Chains. track to meet the IEA’s goal of net-zero emissions
Over the last decade, global manufacturing by 2050.
capacity for solar panels has increasingly moved Global production capacity for the key build-
out of Europe, Japan and the US to China, ing blocks of solar panels – polysilicon, ingots,
which currently has the lead on investment and wafers, cells and modules – would need to more
innovation. than double by 2030 from today’s levels and
China’s share in all the key manufacturing existing production facilities would need to be
stages of solar panels exceeds 80%, says the modernised, said the report.
report, and for key elements such as polysilicon Birol said: “Solar PV’s global supply chains will
and wafers, this is set to rise to more than 95%, need to be scaled up in a way that ensures they
based on current manufacturing capacity under are resilient, affordable and sustainable.”
construction, it said. Governments and other stakeholders around
“China has been instrumental in bringing the world have begun to pay increasing atten-
down costs worldwide for solar PV, with mul- tion to solar PV’s manufacturing supply chains
tiple benefits for clean energy transitions,” said as high commodity prices and supply chain bot-
IEA Executive Director Fatih Birol. “At the same tlenecks have led to an increase of around 20% in
time, the level of geographical concentration in solar panel prices over the last year.
global supply chains also poses potential chal- These challenges – particularly apparent in the
lenges that governments need to address.” market for polysilicon, a key material for making
He continued: “Accelerating clean energy solar panels – have resulted in delays in solar PV
transitions around the world will put further deliveries across the globe and higher prices, said
strain on these supply chains to meet growing the IEA.™

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