LONDON — Hawkish Conservative MPs spooked by China’s influence in the U.K. have a new worry to add to the list: solar power.
China controls 80 percent of the global solar manufacturing market, including both finished solar panels and the raw materials needed to build them.
The U.K. has ambitious plans to scale up its use of solar power in the next decade, aiming to ramp up from 15 gigawatts of annual generation today to 70 gigawatts by 2035.
But it has no domestic manufacturing capacity. And that means U.K. solar imports from China run to hundreds of millions of pounds every year — and are set to grow still further.
Now Conservative MPs fear this reliance puts Britain’s clean energy goals in jeopardy, while directly exposing the U.K. to a supply chain hit by claims of human rights abuses.
China has a “chokehold” on global supply of solar tech, said Alexander Stafford, a Conservative MP who sits on parliament’s energy security and net zero committee.
That dependency on one supply chain leaves the U.K. “perilously at risk of not being able to reach net zero,” he added.
The net zero risk
The total value of solar panels exported from China to the U.K. in the first half of 2023 alone tots up to almost £300 million, according to research by the energy think tank Ember.
Forty-five percent of U.K. imports of solar modules came from China in 2022, according to another think tank, the China Strategic Risks Institute (CSRI).
“The government must look to secure our supply of the critical minerals and equipment, develop domestic supplies, and work more closely with our international partners, else risk losing our lead [on clean energy],” said Stafford, who is also vice chair of the all-party parliamentary group on critical minerals.
Another Conservative MP on the energy committee, Mark Pawsey, shares those concerns.
“There is a danger in only having one source of supply,” he told POLITICO. “I think the Chinese have got the capacity and the volume but I would be happier if we got a broader source of supply. We could find ourselves in the situation where, for one reason or another, China became less enthusiastic about supplying the U.K. market, and where would we go then? How would we meet that [net zero] objective?”
Reducing U.K. reliance on China is the right goal, experts say. But that’s easier said than done.
“There is no straightforward answer to the question of what level of dependency is too high when it comes to Chinese solar panel imports,” said Bernice Lee, a research director specializing in climate change and international trade at the research institute Chatham House.
In balancing their supply chains, global governments need to offset concerns like energy security, industrial policy, costs, supply, labor conditions and human rights, she points out.
“It is also about meeting climate targets, especially because price could affect, even determine, the speed and scope of implementation,” she added. This is in line with Downing Street’s approach, which is keenly focused on the risk of passing on higher costs to U.K. households in pursuit of cutting carbon emissions.
The here and now
Not everyone is convinced British politicians need to freak out.
Grilled on supply chains by the Commons energy committee in October, Chris Hewett, boss of trade body Solar U.K., pointed out that Chinese imports already play a large and often uncontroversial part in the domestic market. “Do we manufacture mobile phones in the U.K.? No, we do not,” he told the committee. “There are some things that other countries are better placed to do.”
MPs should also focus on “the next decade’s technology” which may be developed closer to home, he said.
For its part, the Department for Energy Security and Net Zero pointed to two initiatives — the government’s critical minerals strategy and its work with industry leaders on the solar taskforce — which it said “will support the increase in solar panel deployment, improve the resilience of our supply chains, and help us meet the U.K.’s net zero ambitions.”
But in the meantime, China does have a “track record when it comes to exercising its economic heft to achieve geopolitical goals,” Andrew Yeh, deputy director of the CSRI said. And a breakdown in diplomatic relations between the U.K. and China “can’t be ruled out,” he said, with immediate knock-on effects on U.K. solar aims.
Beware the ‘dumping ground’
Government ministers, while acknowledging the “epoch-defining and systemic challenge” posed by China, insist that pressing global concerns like climate change cannot be tackled without them.
But the growing reliance on Chinese imports comes at a time of deteriorating U.K-China relations, and an increasingly vocal caucus of Tory hawks who are pushing for Prime Minister Rishi Sunak to take a tougher stance.
The U.K. must not allow itself to become a “dumping ground for inhumane Chinese-made solar,” Alicia Kearns, Conservative chair of the cross-party foreign affairs committee told POLITICO. International solar markets obtain 89 percent of polysilicon and 60 percent of lithium — crucial raw materials in solar panels — from China, Kearns said, with both minerals “produced by persecuted Uyghurs working in slavery-like conditions.”
She called for “strict import controls” on Chinese solar imports, citing both a “strategic imperative and moral duty.”
There is also the inconvenient fact that China continues to be one of the world’s biggest polluters. Tim Loughton MP, a former Conservative minister, said it is a “great irony” that the country producing “by far the biggest proportion of greenhouse gases, fueled by their vast dependency on highly polluting coal-fired power stations, has also become the major pusher of solar panels.”
Time to make new friends?
The dependency does not only pose questions for the government, of course. Opposition Labour leader Keir Starmer previously told POLITICO that the U.K. needs to “wean itself off” China “when it comes to trade, commerce and technology” — but his party’s green targets are even more ambitious than the Tories.
The Labour frontbench is “considering the situation closely,” said Sarah Champion, a Labour MP who is also chair of the international development committee. She accused the government of “short term thinking” in not taking advantage of alternative markets.
And there are potential solutions, says Andrew Yeh at the CSRI, who argues for “incentivizing de-risking” in the U.K.’s exposure to China. That could include embedding “minimum standards of supply chain resilience” into the U.K.’s flagship contracts for difference auction scheme for renewables, or increasing solar deals with “low risk” countries. Yeh calls it “friend-shoring.”
Or Britain could look to the U.S., suggests Mark Pawsey on the energy committee. “If the Inflation Reduction Act means that the U.S. becomes a big producer or there are other markets we can go to, I would argue that would be a good thing,” he said.
Governments in the U.S. and EU have been investing in solar production and setting domestic targets, Chatham House’s Lee points out. But the U.K. is still lagging behind.
“Given the time it would take for them to come online, and the growing demand for these products in a crowded market, it is not necessarily an immediately available alternative source,” she said. “In sum, it is not clear the U.K. has many alternatives [to China] in the short term.”