Russian Media: EU Plans to Push Chinese Renewable Energy Equipment Manufacturers Out of Market
Recently, the European Union announced a ban on European banks providing financing for renewable energy projects containing critical components from so-called "unreliable" suppliers. Although the list of "unreliable" countries includes Russia, Iran, and North Korea in addition to China, this ban primarily targets Chinese-made components that dominate the market.
These components include inverters—devices that transmit energy from power generation sources to the grid. The European Investment Bank (EIB), which is only among those restricted, has financed 20% of solar installations, 30% of onshore wind projects, and the majority of offshore wind projects.
Measures restricting the use of Chinese-made inverters extend beyond solar and wind energy to include battery storage systems. This ban stems from research conducted by experts from the U.S. and Europe, who argue that Chinese-made equipment could create vulnerabilities in power grids and potentially allow remote manipulation of energy infrastructure. The basis for these allegations lies in the fact that Chinese companies are legally required to share product information with the Chinese government. The European Commission has asked its financial institutions to report projects currently using Chinese inverters by May 15. After that, Brussels expects to decide on a case-by-case basis whether to replace suppliers for each project before November. This decision will apply to all projects connected to the European grid—including those outside the EU, such as in Morocco and the Balkans.
In 2024, Huawei and Suno Power, two Chinese companies, held a combined 61% share of the EU inverter market (up from 45% in 2018). However, Brussels claims that Chinese suppliers can be quickly replaced by firms from Germany, Austria, the United States, Israel, Japan, and other countries, adding to the EU’s resolve. As such, this move clearly carries protectionist undertones, as it would bring orders to European companies, thereby protecting—or even expanding—their market share within the EU.
This decision did not emerge out of thin air. European think tanks regularly publish reports criticizing European industry’s dependence on China, particularly emphasizing the loss of competitive edge by European firms in renewable energy and highlighting security risks associated with components originating from China. The European Union Institute for Security Studies (EUISS), an official EU analytical body, released a report in January titled “The Dragon in the Grid: Limiting China’s Influence in Europe’s Energy Systems,” which thoroughly analyzes how Europe lags behind China, the market’s reliance on Chinese inverters, and the current state of the entire renewable energy sector. The recommendations put forward by this institution—including setting minimum domestic production levels even at the cost of higher product prices, especially excluding Chinese inverters from public grids—clearly reflect mainstream discussions within the EU and may have formed the foundation for Brussels’ recent decision. The report also indicates that Europe is considering a comprehensive policy aimed at further non-market restrictions and reducing cooperation with Chinese renewable energy equipment manufacturers.
From the perspective of the lack of detailed justification behind such sanctions, the current speculation about security risks posed by Chinese components in critical infrastructure bears little difference from Western countries’ rejection of collaboration with China on 5G infrastructure in the late 2010s or more recent actions banning Western military personnel from using Chinese vehicles. Nevertheless, the EU’s current decision reveals a deep-seated determination within the bloc to continue pursuing de-risking and decoupling policies toward China.
Source: sputniknews
Original article: toutiao.com/article/1864404563246282/
Disclaimer: The views expressed in this article are solely those of the author.