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  1. Environment
20 July 2022

Will the solar industry cut its ties to modern slavery?

Parts of solar panels are being produced by the forced labour of Uyghurs. The EU and the US are working to change this.

By Afiq Fitri

“Renewable energy is the energy of freedom,” said Christian Lindner, the German finance minister, shortly after Russia invaded Ukraine in February. When the sun shines the cost of solar power falls, and as Russia recklessly restricts gas supplies to Europe, solar power seems like a strong alternative energy supply. However, allegations of slave labour in the solar power industry have raised questions about the true cost of “freedom” and whether import bans on goods made by forced labour may slow the clean energy transition.

Forty-five per cent of the world’s solar-grade polysilicon came from Xinjiang in China in 2021, a region which, as my colleague Katie Stallard wrote recently, has become “what amounts to an open-air prison for the Uyghurs and people from other ethnic minorities”. The increasing evidence of the mistreatment of the Uyghurs has pushed legislators on both sides of the Atlantic to take action designed to pressure the Chinese government into improving conditions. On 21 June the US began enforcing the Uyghur Forced Labour Protection Act (UFLPA), which allows customs authorities to detain any shipments from Xinjiang until companies can prove there was no forced labour involved in the production of their goods. This month the European Parliament adopted a resolution closely aligned with the UFLPA, but which includes goods made with forced labour anywhere in the world. 

“We shouldn’t have to reach our net-zero goals on the backs of those trapped in slave labour,” says Anna Cavazzini, a German Green MEP. She believes Europe can and should reach its climate targets without violating human rights. Jim Wormington, a senior researcher at Human Rights Watch, agrees no company should be complicit in human rights abuses.

Labour protection agreements could, however, slow momentum to replace fossil fuels with cleaner energy sources. In Germany, the Association of Energy Market Innovators has warned that stopping imports of photovoltaics (PV) from China would “trigger a crash” of the sector in Germany and Europe. “The EU does not have a significant PV supply chain and depends completely on imports to support its ambitious climate targets,” says the Brussels-based industry organisation SolarPower Europe.

China dominates the global solar supply chain. Last year Europe relied on China for more than 80 per cent of its solar-grade polysilicon imports. Without the forced labour import ban, this figure will be closer to 90 per cent by 2024, says Johannes Bernreuter, the founder of a solar research organisation. It is estimated that China also produces more than 95 per cent of the world’s solar ingots – the raw materials used to manufacture solar cells –which are then turned into solar wafers from which solar panels are constructed. China is also responsible for around 99 per cent of global solar wafer production, Bernreuter estimates. 

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Xinjiang is at the heart of this production, meaning that most solar panels in the world are likely to have been built – at least partly – by Uyghurs in forced labour. Nottingham University’s Rights Lab analysed the supply chains in the 30 countries that produce the most solar energy. The group estimates that the risk of forced labour being used in solar energy production in China is between 27 and 94 per cent. The lab estimated that India, with its booming domestic solar industry, uses the least Chinese-made materials built with forced labour, while Australia emerges as the worst offender. In Europe, Italy’s on-grid energy production has the highest risk (92 per cent) of using goods produced by Uyghur forced labour, followed by the UK at almost 86 per cent. 

Reducing China's grip on the solar market is difficult. The trade bodies Solar Energy UK and SolarPower Europe have said that they have been working to establish a supply chain monitoring initiative for the industry since 2021, to ensure that "no solar photovoltaic modules made with any component arising from forced labour can enter the European solar value chain". A spokesperson from the UK trade body says it "may take a few years to achieve engagement across a sizeable market share of the sector, though we have already observed strong demand from corporate buyers, financiers and developers across Europe".

Even with the new measures taken by the EU and the US, it will be hard for customs officials to decide whether solar shipments are made with forced labour or not since manufacturers generally use polysilicon from multiple suppliers. Likewise, Chinese firms may create "slavery-free" production lines for Western markets, while continuing to sell products made with forced labour elsewhere, says James Cockayne from the Rights Lab. China could also "adjust its production so that forced-labour products are used more to supply its domestic market and relatively free wage labour is used in supply chains for export, especially to North America and Europe," says David Ball from the Uyghur Solidarity Campaign in the UK.

Despite such concerns, Ball believes that the new measures will encourage companies to ask difficult questions of their suppliers in China. “It will help to raise the profile of the issue and embarrass the Chinese government, forcing it to explain and defend its hyper-exploitative practices,” he says. Jewher Ilham, the forced labour project coordinator at the Worker Rights Consortium, agrees. “There’s no question that these bans, and their effort to end corporate complicity, are having a profound economic impact that is putting real pressure on the Chinese government to end state-sponsored forced labour,” she says. 

The support for import bans on forced labour products is slowly growing across the globe. Similar pieces of legislation are being discussed in the UK and Australia, and Heidi Hautala, the vice-president of the European Parliament, believes that south-east Asian countries with close trade ties with China are “increasingly sensitive" to modern slavery. "There will be leakages, but we have to start somewhere,” says Hautala.

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