Located on the peninsula, Spain is one ofthe countries with the best light resources in Europe. In the period of severepower shortage, photovoltaic becomes an important relief way.In the shadow ofthe Russia-Ukraine conflict, European countries, like Spain, are looking tophotovoltaics to fill the energy gap. Pv demand in Europe is surging, anddomestic companies are speeding up replenishment of this market.In Spain, whereenergy problems are already driving up prices, the government wants to generatemore electricity from photovoltaics.Since the suspension of Nord Stream 2 lastyear, electricity prices in the EU have risen rapidly. In some Europeancountries, such as Spain, electricity prices are several times higher in somedays than in the same period last year. The energy shortages and the resultingincreases in electricity prices have pushed up prices for Spanish consumers,squeezing the purchasing power out of their wallets. Inflation in nineeuro-zone countries, including Spain, exceeded 10% in June. Spanish householdsare starting to think about saving money.

Spain and the eurozone are facing energyshortages triggered directly by the conflict with Ukraine and the EU's embargoon Russian oil and gas. These bans are intended to reduce the EU's energydependence on Russia, but the resulting energy gap is not being filled. Coal,which had been shunned by environmentalists, is also receiving renewedattention.European governments are returning to thermal power generation andaggressively buying coal as a supplementary energy source in preparation forthis winter amid gas shortages triggered by the Russia-Ukraine conflict.The Spanish government hopes to increasethe supply of other energy sources, such as photovoltaic in clean energy.Within the European Union, Spain's overall economy is not small, trailing onlyGermany, France and Italy. It also has some of the best light in Europe and hastraditionally been a leader in photovoltaic development, with its ground-basedpower stations largely free of subsidies.Spain's approved National Climate andEnergy Plan (NECP) shows that the country has a cumulative total installed PVtarget of 39.2GW in 2030. For 2022, Spain is poised to double its installedcapacity to 8GW from 4GW a year earlier.

Germany's current appetite for photovoltaicsis even greater than Spain's.If before the conflict between Russia and Ukraine,Germany's photovoltaic policy took "de-subsidy" and"marketization" as the main trend, after the conflict, Germany wentin the opposite direction, and fiscal expansion and non-marketization measuresof increasing subsidies became the means to accelerate photovoltaicinstallation.In the photovoltaic industry, Germany still has a huge volume ofapplications, and there is a very large demand potential in the future. It alsoforms a large historical installation volume, further, it has a large volumeand high electricity price to carry the energy storage application and demand.Italy,the EU's third largest economy, is also highly dependent on Russian gas and itsdemand for photovoltaics is growing. In terms of cumulative installed capacity,Germany, Italy and Spain are the three largest PV markets in Europe.On May18th, the European Commission officially unveiled REPower EU, which seeks todiversify its sources of natural gas and oil, as well as to transform itsenergy mix.The EU has updated its target for photovoltaic installations, whichis more ambitious than last year's plan. Cumulative installed capacity isexpected to reach 320GW by 2025 and 600GW by 2030.A small part of Europe'sdemand for photovoltaics is supplied by local manufacturers, with Chinese companiesfilling most of the gap.

Before the Russia-Ukraine conflict,photovoltaic installations in Europe were already on the rise. Europe is astrong advocate of global environmental issues, and the core driver of itsphotovoltaic industry is the global two-carbon agenda. An estimated 25.9GW ofnew PV capacity was connected to the grid in the EU in 2021, up 34% year onyear and breaking the previous record of 21.4GW in a decade, according to areport by SolarPower Europe. According to China Customs export data, theEuropean market imported 40.9GW PV modules from Chinese PV companies in 2021,up 54% year-on-year from 26.7GW in 2020. After the conflict between Russia andUkraine, the development of new energy is not only an environmental issue, butalso a core issue of European economic security. As a result, Europe's demandfor Chinese PV products has further increased.Customs data showed that in thefirst quarter of this year, the European market imported 16.7GW of PV modulesfrom Chinese PV companies, up 145 percent from 6.8GW in the same period lastyear, making it the overseas market with the largest growth. In the first fivemonths of this year, China exported 34GW of components to the European region,up 129% year on year. In May alone, Chinese PV module exports to Europe reached9GW, up 15% from the previous month.