EU bans funding for energy projects using Chinese inverters

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As covered by PV Tech Premium on Wednesday, rumours of the ban began to circulate last week. Now, a handful of European outlets have reported that the decision was confirmed in a video conference with various European Directorates-General and affected industries.

The ban will reportedly cover all European projects and any in neighbouring regions like the Balkans and North Africa that are connected to the European grid. The affected countries are reportedly China, Russia, Iran and North Korea, though for renewable energy, the only major source country is China.

Responding to the news, Christoph Podewils, secretary general of the European Solar Manufacturing Council (ESMC), said: “This is a truly bold decision with the potential to help revitalise manufacturing in Europe and other like-minded economies”

The move is more far-reaching than previous Commission actions on inverter supply. Its revised Cybersecurity Act proposed plans to identify “high-risk” products and suppliers to be excluded from the European grid, but did not specify China or a blanket ban on funding.

Solar PV inverter manufacturing capacity in Europe has remained relatively strong, despite challenging financial circumstances for major producers. The ESMC said that “the EU’s current production capacity stands at over 100GW per year. A further 45GW of expansion is planned in existing European facilities by 2027”. As such, it said that switching to Western or European-made inverters is “highly cost-competitive” with Chinese imports. You can find the ESMC’s full statement here.

PV Tech has contacted the European Commission for further information on these reports.

Inverter cybersecurity risk

Groups like the ESMC and SolarPower Europe have previously called for the Commission to support Europe’s solar inverter producers, given the strategic security of the technology.

Inverters pose a risk to cybersecurity, as they are almost always digital products connected to internet servers. As solar and other inverter-based energy become more central to Europe’s grid, including the expansion of internet-linked residential systems, this poses a significant risk to the continent’s energy security.

Erika Langerova, head of the energy systems department at the technical university of Prague, told PV Tech: “This is a necessary and justified move by the European Commission. Inverters sit at the heart of grid control, and allowing high-risk vendors into that layer is an avoidable vulnerability. Given persistent concerns around state-linked cyber activity, treating Chinese suppliers and operators as high risk in critical infrastructure is simply basic risk management, not protectionism.”

However, restrictions on funding for projects with Chinese inverters may not be a clear-cut cybersecurity win. Ryan Davidson, principal consultant for grid digitalisation and cybersecurity at DNV, told us that: “This move helps energy sovereignty but does very little to address the cybersecurity of the infrastructure, as it does not address critical cybersecurity controls needed for all distributed energy infrastructure.

“While it would improve energy sovereignty by increasing the percentage of capacity from Western manufacturers, China will still have enough capacity of installed inverters, that, if they really wanted to, would have the ability to cause disruptions.”

Moreover, the measures will only affect the parts of the solar market that receive funding from the EIB or other EU institutions. Chinese products are a huge majority of the inverters in the European market, and that may shrink somewhat with the removal of EIB backing, with possible ripple effects into private asset owners’ purchasing habits.

“But for context, this is still not unique to Chinese inverters,” Davidson said. “With a global supply chain, there are still other concerns … including energy reliance on Russian oil or digital reliance on US cloud and telecommunication infrastructure.”

A total of 30 lawmakers in Brussels previously called for EU-wide restrictions on Chinese inverters, due to the energy security implications. The EIB then expressed its concern, urging dedicated funding for European producers to lessen the cybersecurity risk of imported products. We have previously reported on the “growing sense of threat” among lawmakers that underpins proposals for a bolstered Cybersecurity Act.

Earlier this week, PV Tech Premium published a report from the SolarPLUS Europe 2026 conference in Milan, where cybersecurity experts said that the EU was “surprisingly” resolved to take “harsh” steps on cyber enforcement, as well as outlining the potential impacts and details of an attack on digital energy infrastructure, such as the December 2025 Poland attack.