Rystad Energy sees 25 percent of European solar and battery production at risk from high electricity prices
Post date: 06/10/2022 - 16:58
Norwegian energy business consultancy Rystad Energy AS warns of a dramatic slump in European solar and battery production. 35 gigawatts (GW) of annual photovoltaic production capacity (total for various components) and more than 2,000 gigawatt-hours (GWh) of battery cell production capacity could cease operations or not even begin, unless electricity prices quickly return to »normal levels.«
Accordingly, the build-up of capacity is already being delayed. For example, Britishvolt’s planned gigabattery factory in Blyth, UK, with a production capacity of 30 GWh, has already been postponed until mid-2025, partly due to high energy costs.
In recent years, Europeans have benefited from a reliable and affordable power supply. The solar industry had calculated with stable electricity prices around EUR 50 per megawatt hour (€/MWh) when building up its production capacities. In the meantime, prices in Germany – after spikes that were much higher in the short term – are over €600/MWh and in France they are €700/MWh. With manufacturers in regions such as Asia having lower electricity prices, European manufacturers were becoming less competitive by comparison.