Key takeaways from SolarEX, Istanbul

Istanbul’s position as a bridge between Europe and Asia was clear to see at the 16th annual SolarEX conference. Chinese equipment and materials suppliers were out in force at the three-day event, lining the peripheries of Turkey’s largest solar show. They were attracted by the opportunities that a rapidly expanding module assembly market present.

The solar market in Turkey is characterized by protectionism and the effect of this was obvious on the exhibition floor. There was general consensus that there are now more than 80 module manufacturing businesses in the country, although the vast majority are still relatively small players. Consultancy PwC shared analysis with pv magazine reporting that only eight companies in Turkey possess more than 1 GW of annual production capacity, as of February 2024. And while the government aims to add 3.5 GW of PV capacity every year through to 2035, there was skepticism among industry stakeholders over whether the module market is big enough for so many new entrants. Some consolidation seems inevitable.

That didn’t deter the Chinese suppliers in attendance who were offering just about everything required to start a module assembly business from scratch. Companies ranging from solar cell manufacturers and silicon sealant suppliers, to equipment businesses offering turnkey module assembly line solutions were all present. And they were positive about their future prospects in the Turkish market.

Storage was also on the agenda, with talk of building a domestic battery assembly market. The government in Turkey announced a 30% import duty on lithium iron phosphate (LFP) battery products in early 2024 in a bid to kick-start a domestic battery manufacturing industry. But here, too, there was some skepticism on the floor. The nascent status of Turkish battery cell manufacturing means many will assemble batteries using imported cells – limiting the warranty that domestic manufacturers can offer.

And while protectionism shapes the Turkish module and battery market, the future for Chinese inverter brands in the country seemed more assured. One Chinese inverter company with multiple gigawatts of production capacity told pv magazine that while the possibility of Turkey introducing measures to restrict inverter imports was a small concern, the complexity of inverter technology combined with the current lack of domestic capability should protect business for a decade or more.

Access to finance and the continued poor performance of the Turkish Lira against the Euro also shaped discussion at the trade fair. Turkish solar installation growth is C&I driven, while the residential sector continues to drag compared to markets in Western Europe. As long as access to finance remains challenging for Turkish consumers, that’s unlikely to change significantly.