EU Solar for Sustainable Growth

The development of affordable, inexhaustible and clean renewable energy technologies such as solar, hydro and wind will have huge longer-term benefits. They will increase countries’ energy security through reliance on an indigenous, inexhaustible and mostly import-independent resource, enhance sustainability, reduce pollution, lower the costs of mitigating climate change, and keep fossil fuel prices lower than otherwise.

PV panels only require daylight, not direct sunlight to produce electricity. This means that they are not just effective in the summer months, but all year round, even on the cloudy days. The sun is an unlimited, free source of energy that is available worldwide. Every hour, enough solar energy strikes Earth to meet human energy needs for more than a year, according to NASA.

Security of supply is a central objective of European energy policy. Fossil fuels are becoming increasingly scarce and more expensive. In 2010, the EU imported over 556 million tons of crude oil. In 2011 Germany alone imported crude oil and natural gas worth €82 billion. The EU can rid itself of this dependence through solar energy and other renewables.

Potential of Solar Energy

Solar energy demand is increasing strongly globally and particularly in the EU. PV is now, after hydro and wind power, the third most important renewable energy source in terms of globally installed capacity.

By the end of 2011, the installed capacity of PV systems was more than 50 GW in Europe. With increasing contributions from southern European countries, over 60 billion kWh are generated every year, which is enough power to supply more than 15 million European households. 75 percent of the global photovoltaic expansion seen in 2011 was installed in Europe, which is also where 75 percent of the globally installed PV capacity is located. The reduction in solar module prices due to continuing innovation by the European industry is a strong incentive for PV system operators. This, in turn, means that the price of generated solar power will continue to fall.

“Global annual installations of solar PV could increase 50-fold by 2020 compared with 2005, achieving installation rates that could rival those of gas, wind, and hydro and that might even outpace nuclear.”

Source: McKinsey Solar power report April 2012

The share of solar energy continues to increase across Europe. At the end of May 2012, the total PV capacity in Germany reached a record value of over 40% of all electricity sources for the first time. The 20 GW of electricity produced in that instant equals to the production of 20 nuclear power plants.

  • Solar PV technology is low maintenance, durable and completely noiseless.
  • Solar energy is the closest renewable to end consumers grid parity.
  • Solar energy is helping to bring down EU electricity prices. In Germany solar PV has shown to cut peak electricity prices by up to 40 per cent.


  • Sustainable decline in PV prices will help solar installation. Prices of solar modules have declined substantially as innovation continues. In the future the costs of solar energy will continue to fall, while prices in the overall electricity market will rise making solar increasingly the rational economic choice.
  • When real prices for solar electricity reach so-called grid parity, the motivation to generate solar electricity will be stronger than ever. In some regions in southern European countries, this quantum leap is imminent.
  • Decentralized energy generation makes for shorter transmission routes and lower energy losses caused by transmission. A multi-billion euro power grid expansion is not necessary with photovoltaics, which also drives prices down.

“Solar photovoltaic (PV) electricity can be competitive with grid electricity in some European markets (Italy) as early as 2013, and in all market segments across the continent by 2020”

Source: EPIA AT Kearney Study 2011.