Fri Nov 01 10:30:00 UTC 2024: ## US Outpaces Europe in Solar Manufacturing, While Europe Leads in Deployment

**Brussels, [Date]** – A new analysis by Bruegel and the Rhodium Group highlights diverging trends in solar energy deployment and manufacturing between the US and Europe. While Europe continues to lead in solar capacity deployment, the US is experiencing a surge in manufacturing investments thanks to incentives under the Inflation Reduction Act (IRA).

The report, the second in a series comparing clean tech trends across the Atlantic, shows that the EU has installed 257 GW of solar capacity, generating 9% of its total electricity. The US, despite having more sunshine hours, has deployed 139 GW, producing 6% of its electricity. However, this gap in deployment is being narrowed by the US’s rapid increase in solar manufacturing capacity.

The IRA, enacted in 2022, has spurred significant investments in the US solar manufacturing supply chain, with companies investing over $2 billion in Q2 2024, a tenfold increase from the previous year. This has led to a doubling of module assembly capacity in the US, reaching 38 GW in 2024. Meanwhile, European investments have remained at their lowest level since 2021.

This shift in focus towards domestic manufacturing has also affected trade patterns. While Europe relies heavily on Chinese imports for solar panels, the US has diversified its supply chain, with increased imports from Vietnam, Malaysia, Thailand, Cambodia, India, and South Korea.

Despite the US’s recent surge in manufacturing, the report acknowledges that both regions remain heavily reliant on imports, running trade deficits of around $20 billion for solar modules and cells in 2023. The EU has already implemented anti-dumping duties on Chinese solar panels in the past, but these were lifted in 2018.

The report concludes that the diverging trends in solar development are likely to continue, with the US focusing on building domestic supply chains and reducing reliance on China, while Europe prioritizes rapid deployment of solar energy for electricity generation.

The next installment of the Bruegel/Rhodium briefing series will explore these trends in other clean energy technologies.

Read More