People in Europe’s gas crisis are hurrying to install solar panels for their homes and businesses as they face a “perfect storm” that is bringing energy costs to all-time highs.
According to data provided with CNN Business by the German Solar Association, solar system installation in Germany increased by 22% in the first six months of this year compared to the same period last year. The association stated that this comprised both residential and commercial applications, ranging from modest installations on individual rooftops to big solar farms.
This has resulted in a significant increase in sales for enterprises in the renewable energy industry, as well as an added burden on supply chains.
Demand for solar power was already on the increase in Europe’s largest economy, as energy prices rose, legislative incentives were implemented, and technological adoption became more widespread. However, customers have recently faced rising power bills, scorching temperatures, and fresh concern about whether they would be able to keep the heat on this winter.
Why are UK energy costs growing considerably faster than those in Europe?
Russia has significantly restricted the supply of gas to Germany and other EU nations since its invasion of Ukraine six months ago. It recently announced an unannounced shutdown of its Nord Stream 1 pipeline for repairs later this month, bringing spot natural gas prices to a new high.
Many people’s greatest concern this winter is that Russia would switch off the water totally. The German government has already initiated a crisis management strategy that might result in company restrictions if this occurs.
“This [desire] has only grown greater with the conflict unfolding on our doorstep,” David Wedepohl, managing director of the German Solar Association, told CNN Business.
“This is something that a lot of people are thinking about.”
German government have responded to the problem by urging citizens to conserve electricity. Some communities have already reacted by reducing essential services such as lighting, showers, and heating.
According to Jim Gordon, CEO of Smartflower, the global upheaval has also prompted more individuals to convert to solar. The firm sells sunflower-shaped solar power gadgets to corporate campuses, institutions, and private residences.
“Our business is thriving because a perfect storm of things is colliding that is really elevating solar energy,” Gordon told CNN Business.
“People are anxious about the security of energy,” he remarked. “An authoritarian ruler can close a gas pipeline and cut off energy, but no one can control the sun.”
Sales are surging.
Schneider Electric (SBGSF), a European industrial and energy conglomerate, reports that demand for its solar-powered heating systems in Germany has “nearly quadrupled” this year compared to the same period in 2021.
According to Konstantin Elstermann, the firm’s vice president of home and distribution, the company’s sustainability department, which advises businesses on clean energy procurement, has also achieved a “all-time peak” in advisory requests.
Similarly, Sonnen, a German producer of solar batteries, has seen its orders “more than quadruple in comparison to last year” due to a “increasing demand for [people] operating their houses with sustainable energy,” according to CEO Oliver Koch.
Koch told CNN Business that his team had noticed “an extra boost in demand since the end of February,” when the conflict began, and that they were “continuously extending our manufacturing capacity to stay pace with demand.”
According to managing director Robert Sawyer, Smartflower is now planning to treble its sales in Germany this year.
“We conducted more business in Germany in the first six months of 2022 than we did in the entire year of 2021,” Sawyer said, adding that sales in the nation have increased.
Obstacles in the supply chain
Such booms, however, are not without obstacles.
According to Elstermann of Schneider Electric, the sector is now experiencing acute labor shortages.
“Some electricians are booked up three to six months in advance,” he was cited in the press as saying.
“This bottleneck is nearly as severe as the existing scarcity of raw resources and manufacturing capacity. We know that the pandemic’s supply constraints are only transitory, but the scarcity of competent personnel persists “Elstermann explained.
According to Wedepohl, the industry is rushing to fix the issue. Many electricians who left their positions in the last decade have “reentered” the market, he says, and roofers are now being called on to assist with installs.
“A lot of installers are out there putting in additional shifts, training people, and bringing on new individuals,” he explained. “It’s a challenge, but it’s an opportunity that we want to seize.”
The issue of sustainability
For the time being, Germany has resorted to restarting its coal-fired power plants in order to minimize its gas use and keep the lights on.
However, Chancellor Olaf Scholz has made it obvious that the government is not pleased.
“It’s unfortunate that we now have to use those power plants that we had previously shut down due to Russia’s savage war on Ukraine. But it’s only for a short time, “He stated this in a message last month.
Across Europe, similar discussions are taking place.
In the year and, the Great Britain also made a drive for alternative energy sources such as wind and nuclear power. Alternatives to gas heating, such as wood-burning fireplaces, have also grown in popularity among some customers.
Austrian environment minister Leonore Gewessler called for additional green energy projects this month to help the country transition away from Russian gas.
“We need to extricate ourselves out of this reliance — cubic meter for cubic meter, windmill for windmill, PV installation for PV installation,” she stated in the press, referring to the units used in the construction of solar and wind energy capacity.
“Because we perceive our reliance on fossil fuels being used as a weapon in a fight,” Gewessler explained.
“Winter is approaching,” Wedepohl remarked, stressing that most houses in Germany are already cold.
Michelle Toh, Chris Liakos, and AJ Davis from CNN contributed to this story.