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Menlo Electrical, a Polish wholesaler of photo voltaic panels, is Europe’s fastest-growing firm on this yr’s FT1000 rating, due to sturdy demand for Chinese language-built merchandise in its house continent and likewise markets together with the Center East and Africa.
Between 2020 and 2023, Menlo achieved annual compound progress of 830.8 per cent, with revenues of virtually €151mn in that closing yr.
Menlo expanded strongly throughout the Covid-19 pandemic and likewise after Russia’s 2022 invasion of Ukraine, which despatched Europe’s vitality costs hovering and inspired extra households and corporations to put in their very own solar energy.
However, reflecting a broader pattern, Menlo’s most up-to-date earnings have suffered from a market glut, in order that founder and chief govt Bartosz Majewski is forecasting for 2025 a second consecutive yr of flat revenues due to decrease costs.
“There is a huge issue of overcapacity and oversupply in the market, even though the demand globally is growing at a healthy pace,” he says.
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For a number of years, China has spearheaded the market’s progress by producing photo voltaic panels in factories which have benefited from giant authorities subsidies and the nation’s decrease labour prices.
However international locations together with the US and India are additionally constructing extra crops, partially to chop their very own reliance on imports from China. This additional manufacturing might add to the oversupply downside, Majewski warns, which might imply that solely European firms with sturdy steadiness sheets may very well be assured of surviving.
“Last year was a very challenging year for all distributors and installers in Europe, and we’ve seen a wave of bankruptcies or restructurings,” Majewski says. “Now it’s just a matter of who has the biggest war chest and deepest pockets to see them through this current period and emerge on top, while the smaller and less capitalised players drop out.”
The European Photo voltaic Manufacturing Council, an trade affiliation, estimates that Chinese language panels at the moment are being bought at about half of their manufacturing value in Europe, which helps clarify why a dozen European producers have gone bankrupt since 2023. The ESMC is asking on European policymakers to implement emergency measures to guard native producers from cheaper imports.
“Today’s unfair trade practices must be addressed to create a fair and level playing field,” says ESMC secretary-general Christoph Podewils.
Based in 2020, Menlo has been promoting principally panels acquired from Chinese language producers, however Europe’s powerful market circumstances have not too long ago additionally allowed the corporate to select up surplus inventory from European rivals.
“Because there is a big oversupply in Europe of panels and also batteries and inverters, we are more and more buying not directly from China but from other distributors in Europe, because frequently you get more attractive terms from distributors who previously acquired components and are now looking to offload them,” Majewski says. “It’s a moment of risk because of this decline in prices, but also of opportunity.”
He understands why European firms need extra regulatory safety in opposition to cheaper rivals, however warns that utilizing tariffs as obstacles to commerce might hurt the photo voltaic vitality market in the long run.
Some consultants additionally query the advantages of boosting EU subsidies. “Supporting solar manufacturing purely for the sake of being European does not present clear advantages in terms of accelerated decarbonisation or increased economic growth,” Bruegel, a Brussels-based think-tank, wrote in a report final yr. “Manufacturing subsidies for the solar industry should prize innovation only.”
Menlo made its first foray overseas by promoting photo voltaic elements in Germany and the Netherlands. However it now additionally has a regional hub in Dubai and warehouses in Jordan and Iraq, which provide clients in a big array of nations, from Senegal to Pakistan. One other hub is in South Africa, which Majewski says is now turning into Menlo’s fastest-growing market.
European demand for solar energy grew after Russia reduce gasoline provides to Europe. However Ukraine additionally final yr grew to become a marketplace for Menlo, as individuals turned to photo voltaic installations to deal with energy shortages brought on by Russian assaults.
Menlo is headquartered in Warsaw however Poland now solely accounts for about 20 per cent of its revenues, in contrast with 50 per cent in 2022 and about 90 per cent in 2021.
Majewski, 39, is a former McKinsey administration advisor who switched to the vitality sector, together with a stint with Orlen, Poland’s state-controlled oil and gasoline firm. He’s amongst a dozen Polish shareholders of Menlo, all of whom have been in renewables for not less than a decade.
Like others, Majewski is watching anxiously as US President Donald Trump imposes extra tariffs and threatens to escalate his commerce warfare with China.
However even when tariffs might push up costs of imports from China, Menlo is unlikely to cease promoting Chinese language panels to cost-conscious clients. Most of Menlo’s European clients purchase Chinese language panels that transit via the Dutch port of Rotterdam.
“The challenge is that clients don’t want to pay extra . . . even professionals who are investing in utility-scale solar installations don’t want to pay extra for components that are manufactured in Europe,” Majewski says.
“We’re just not competitive when it comes to costs and it’s very difficult to close that gap, not only because of the state support that Chinese manufacturers are receiving, but also partially because of the scale of what they have already deployed.”
