Solar Panel Manufacturing: The Latest Battleground in the Ongoing Trade Conflict with China
Efforts to establish alternative supply chains free from Chinese producers and exporters are struggling due to conflicting and burdensome regulations.
The movement to seek alternatives to China-based sources of silicon has gained momentum recently in both America and the European Union (EU). Concerns about the ethical and geopolitical repercussions of engaging with Chinese state-controlled exporters have sparked a movement to bring solar panel production back onshore.
Energy importers in Western nations understandably prefer supply chains independent of China, particularly considering China’s involvement in human rights violations like genocide against the Uyghur minority and concerns about various oppressive activities. However, the cost of energy remains a significant disadvantage for Western countries compared to China.
The EU is keen to reduce its heavy reliance on Chinese silicon imports for solar panel production, but faces challenges in competing with China due to energy cost discrepancies and economies of scale.
Regulations in Western nations, along with high energy costs, pose hurdles for developing competitive supply chains independent of China. The environmental regulations, in particular, hinder energy independence efforts.
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China’s low-cost energy and lack of stringent environmental regulations contribute to its dominance in Silicon production, posing a significant challenge for Western nations to compete with. The recent legislative efforts in the U.S. to boost domestic LNG production signify a step towards achieving energy independence and reducing reliance on Chinese supplies.
Despite the ethical and geopolitical concerns of dealing with Chinese supply chains, Western nations face challenges in developing competitive alternatives due to existing regulations and high energy costs.
