Why are solar panels and batteries from China so cheap?

Hannah Ritchie · 15 May 2025

Others here said this too

High electricity prices are what is killing European industrial competitiveness.

Their wordsAnother factor that is killing Europe’s competitiveness — not just for batteries but for many industrial products — is the high electricity costs.

Also said by John H. Cochrane

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Hannah Ritchie did not write this page.

Every claim below was made in this piece, quoted word for word and numbered in the order the piece makes them, so you can read it there rather than take our word for it. The sentence above each quote is our reading of the claim, not their wording. Each quote was checked against a stored copy of the page at build time; where the two differ, the quote is the fact.

Our reading
Tariffs on Chinese clean energy reduce the total number of clean-energy jobs, because most of those jobs are in deployment rather than manufacturing.
Mental modelSecond-order thinking

Their wordsThat’s because most clean energy jobs are in deployment and maintenance rather than manufacturing, and since higher costs slow down the rollout of renewables, increasing prices reduces the total number of people working in clean energy (even if the number working in manufacturing increases).
Our reading
Chinese solar panels and batteries are cheap because of automation and a honed supply chain, not because of cheap labour.

Their wordsBut, China mainly dominates these markets because it has produced a long-term industrial strategy for these technologies and has honed an optimised, modern supply chain as a result.
Our reading
High electricity prices are what is killing European industrial competitiveness.

Their wordsAnother factor that is killing Europe’s competitiveness — not just for batteries but for many industrial products — is the high electricity costs.
Our reading
Forced labour in Chinese clean-energy supply chains is real, and it is not why the goods are cheap.

Their wordsBut my point is that this is still not the reason (or is only a very small reason) why these goods from China are cheaper than elsewhere. The main driver of lower labour costs has been automation; not having a human worker at all.
Our reading
A country cannot fund its own industrial strategy and call the same policy cheating when China does it.

Their wordsBut you cannot support these programs while calling out China for “cheating” for doing the same.

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