Solar Valley: The next sunset

Sales slumped by up to 90 percent

"Unfortunately, Solar Valley has not existed in its original form for ten years now," says Carsten Körnig, Managing Director of the German Solar Industry Association. He has been following the development of the solar industry for 30 years. "Germany was once a pioneer in the solar industry."

The "Solar Valley" emerged shortly after the turn of the millennium and was considered one of the largest centers of the solar industry in Europe. Numerous companies settled in the industrial area in the Bitterfeld district of Thalheim. There were up to 3,500 jobs. Then, around 15 years ago, the first decline of the manufacturers of solar modules and their preliminary products began, says association head Körnig. With massive, sudden cuts to subsidies, the black-yellow coalition around 2012 caused domestic demand to plummet by 80 percent. Companies suffered a drop in turnover of between 80 and 90 percent.

Massive expansion in China pushes down prices

At the same time, China massively expanded production and flooded the global market with cheap solar modules. Numerous companies in Solar Valley went bankrupt. According to the industry association, the German solar industry lost around 100,000 of its 130,000 jobs at the time. The market is now in Chinese hands. According to the International Energy Agency (IEA), China accounted for 75 percent of global module production in 2022. "The figures speak for themselves and the situation has not improved since then," says Körnig. In 2021, Meyer Burger tried to bring production back to Germany by setting up its sites in Saxony and Saxony-Anhalt - to no avail. "We have allowed a technology that comes from Germany and was developed here to be handed over," says the former Meyer Burger CEO Erfurt. In the meantime, there are no longer even any announcements in the industry that anyone takes seriously.

"I wouldn't say that the solar industry is dead"

"I wouldn't say that the solar industry is dead," counters Ralph Gottschalg. He is the director of the Fraunhofer Center for Silicon Photovoltaics in Halle (Saale) and a professor at Anhalt University of Applied Sciences. The institute was founded at the time to support Solar Valley. "Unfortunately, the first trough was already there." The market has changed dramatically over the past 20 to 30 years. Germany will not be able to compete for standard products - "for everything that is packed in containers". China will always be cheaper. But there are niche products, such as façades with photovoltaics, which cannot be packed in containers. The market is still huge there too.

At the same time, Germany continues to be a leader in research. And also in the so-called downstream market, i.e. the trade, installation and maintenance of systems. "In terms of economic benefits, this is also not to be sneezed at," says Gottschalg. The German Solar Industry Association speaks of around 150,000 employees in the solar industry in Germany. There are more than 20,000 companies in Germany that offer photovoltaic systems or services for the solar industry.

Tariffs, bonuses, subsidies: Experts see various options

In terms of research, some companies are still based in eastern Germany, he said. The original Solar Valley is therefore still radiating into the present day, says Managing Director Körnig. Innovative companies from the Solar Valley region are still internationally sought-after technology partners. However, they need clear prospects for the future. "In principle, there is still the possibility of a renaissance of the solar industry in Germany and Europe."

However, the best research cannot deliver in the long term if the industry is no longer there, argues former company boss Gunter Erfurt. However, there are various approaches among experts as to how the industry can be saved, for example, there could be incentives or bonuses for the use of German solar modules. However, opinions differ on the subject of subsidies and tariffs. The fact is, says Erfurt, that there are no more options if politicians do not take action now. "I am hopefully known as an optimist: It's only too late when we lose the technological basis to do anything."

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