A new E.U.-China deal to set a price floor on cheap Chinese solar panels has opened rifts among European policymakers, manufacturers and environmental advocates, with green energy taking a back seat to broader efforts to defend a fast-growing European export market in China.
The deal, intended to provide partial shelter to European solar-panel manufacturers, averts a broader trade war, as Europe struggles with record-high unemployment and gloomy prospects. China had threatened to boost tariffs on European wine if planned tariffs on Chinese-made solar panels of up to 67.9 percent had gone into effect. Instead, the floor will keep prices from falling further from their already-low levels, a step that European solar manufacturers say will do little to protect them.
The divisions have been especially wide in Germany, which has some of the most ambitious green goals in Europe and is the hub of the continent’s once-booming solar-panel industry. Now, Chinese-made solar panels compose 80 percent of the European market.
Many backers of E.U. green initiatives who support the deal say that they do so with mixed feelings.
“We were quite a bit divided. We had quite a few talks,” said Sven Teske, Greenpeace International’s renewable-energy director, who lives in Germany.
“We came to the conclusion that the rapid expansion of solar manufacturing in China was actually, at the end of the day, quite good,” he said. “The negative side is that in Germany, solar was a very good way of showing to the general public, ‘See, you can also get a job with renewable energy, and it’s a good alternative to the coal-based jobs,’ ” which are a major part of the economy in areas of eastern Germany, where many solar-panel manufacturers had set up shop.
Higher prices for Chinese solar panels would have preserved manufacturing jobs in Europe but would slow the solar boom that has covered European roofs, fields and open spaces with photovoltaic panels. Labor costs are far cheaper in China, and E.U. manufacturers say Chinese factories benefit from cut-rate, government-backed prices for aluminum and other raw materials.
Germany subsidizes solar-panel installation, regardless of who manufactured the panels, through guaranteed rates paid for electricity fed back into the grid. The country leads the world in installed solar capacity, although its area is just 3.5 percent of the United States’. Last year, Germany generated 4.7 percent of its electricity from photovoltaic sources.
Some European environmentalists say that going green might create fewer jobs than they had once hoped. That gloomier assessment is echoed in the United States, where the Obama administration’s first-term emphasis on the possibilities of green jobs has largely given way to a second-term focus on nurturing a manufacturing boom through cheaper fossil fuel energy.