Season 7, Post 18: Not much sun in Munich

It seemed in keeping with the current mood that when your author and several thousand other people attended this year’s Intersolar conference, the sky was grey, with an absence of sun. With geopolitical tensions, a belligerent US President and lingering questions over what caused Iberia’s recent energy blackout, few of the visitors may even have noticed the ten-degree temperatures braved in Munich. None would have needed the free samples of sun cream handed out. The beer tent, however, did seem busier than usual.

What was perhaps most evident from this year’s event (see notes from prior visits here and here) was the significance of China’s presence, markedly higher than in the past. The country’s vendors filled almost two of the six halls dedicated to solar (visitors can also learn about electric vehicles and battery storage at the event). There seemed to be clear evidence of product discounting, as if players from the country were seeking to seize the opportunity and capitalise on America’s currently more uncertain global role. They were, however, not the only ones, with Indian and Turkish vendors also highly visible.

These businesses are clearly onto something. It was obvious to your author from the conversations he had that imported fossil fuels are no longer the preferred option in Europe, for multiple obvious reasons. Beyond striking deals with foreign vendors, there seemed to be a growing recognition that Europe needs to develop its own solar industry. Domestic solar manufacturing and production in the Eurozone would naturally lower risks for project vendors. Policies such as the Net Zero Industry Act and the Eurozone Clean Industrial Deal were seen as helpful. Plans are apparently afoot for multi-phase, highly automated wafer-to-module production plants in Spain, France, Italy and Sweden. How these will be funded, of course, is another matter. Other industry participants stressed the need for tax credits and training.

The other topic that occurred with regularity was the growing realisation of the importance of batteries and other energy storage solutions, particularly in light of the recent problems witnessed in Spain and Portugal. The energy storage market is growing at a faster rate in Europe than any other global region, albeit from a lower base. Participants with whom we spoke recognised that there is a need to learn from the mistakes of Northvolt. The future is likely to be one of collaboration with South Korean, Japanese and American vendors (there appeared to be more hesitancy around Chinese partners). Think of storage as part of the journey towards energy autonomy. Or, as one conference attendee put it, “tariffs have toppled everything.”

Please note, the Future Trends Blog will be taking a brief holiday (in Scotland) next week and will return towards the end of May.

14 May 2025

The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.

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Alex Gunz, Fund Manager

Photos by the author