Scarce goods, scarcity economy, delays, organizing, improvising - our fellow citizens from the former East Bloc know these terms all too well. The centrally planned socialist economies were characterized by shortages of almost everything that is readily available in today's consumer society. Not until the collapse of communism and the fall of the Berlin Wall in Germany at the end of the 1980s did citizens of the GDR get a new lease of life. Suddenly, everything was supposed to be available in abundance, for sale anytime and anywhere. In many sectors, even more was produced than could be consumed by its expiration date, and market prices plummeted. As a result, the values of thrift, stockpiling and repairing, instead of buying new things were increasingly abandoned - virtues and behaviors that, at least in the middle of the last century, were still wholeheartedly embraced throughout Western Europe.
The production surplus and unbridled consumption, constantly fueled by clever marketing and artificial demand generation, is driven by a promise of growth - no, by compulsive growth - without which the globalized economic and financial system would cease to function. Unfortunately, we are increasingly faced with the realization that this has given rise to massive social distortion and resulted in the radical exploitation of the planet along with the destruction of the habitats of so many living creatures. But what am I driving at?
With all the unrestrained growth, which in many areas is certainly thought to be politically desirable and subsidized with public funds, one area has fallen by the wayside and criminally neglected, at least over the past ten years: renewables. And this, despite the fact that its proponents long ago demonstrated what was possible and necessary. Following a brilliant start at the beginning of the 2000s with terrific successes, the government hit the brakes from 2010 onwards - mainly out of fear of losing control over the energy transition - and unfortunately succeeded in keeping the sector as small as possible. "Don't need that (yet)," they claimed, "It doesn't work", "Too expensive anyway!".
Now, all of a sudden, everyone - politicians, businesspeople, the media, and the proverbial "man in the street" alike - realizes that we need renewables somehow, and as quickly as possible. But now the train has all but left the station. For too long, there has been heel dragging in the expansion of wind power and photovoltaics. The collapse of the European solar industry and the exodus of skilled workers were simply shrugged off. Now we've all been left holding the bag and have to figure out how to make the most of our very scarce resources. We have to relearn how to deal with scarcity and how to economize - old knowledge and ingenious concepts are in demand.
In recent days, quite a bit has been said and written about this in the technical world. We in the industry are being called upon to perform an unimaginable feat of strength. Due to the failures of past decades - not only of previous governments in Germany, but around the world - the catching up needed to transform the economic system and introduce renewable energy has now become so great and the time remaining so short that we really ought not to have a moment's peace. The urgency seems to have been recognized at least by our current traffic light coalition government because the Minister of Economics and Climate Protection, Robert Habeck, recently presented realistic expansion targets in line with the goals predicted or called for by environmental and industry associations - long ago, unfortunately. The only thing missing is a coherent implementation concept. It will take more than just blind activism, however, since the underlying conditions are so poor, as already mentioned.
What do the proposed expansion targets mean for the PV industry and what is in store for us in 2022?
The first thing to note is that we are still in the midst of a global health crisis that is once again increasingly affecting supply chains. The advance of the new Omicron variant is leading to personnel-related downtime in production and logistics. At present, entire cities in China are again being sealed off to prevent local spread. However, if the Chinese government's zero-covid strategy does not work, which is the fear with this aggressive virus, the population and economy still have a lot ahead of them. We can only guess what this will mean for the supply of goods to the rest of the world. In Europe, the on-time flow of goods is currently being hampered by a shortage of truck drivers, which is causing shipping costs to skyrocket. There are hardly any real production facilities in the photovoltaic sector that could be affected by the pandemic.
The year is still young, and demand for PV components has not yet really taken off. On the price front, little is happening at the moment, anyway, as many manufacturers are still sorting themselves out. For the remainder of the year, prices are even expected to fall again - both in the semi-finished and finished products sectors as well as in the international transport sector. But this may be a bit too optimistic. If the political course is in fact set as quickly as some ambitious statements suggest, we could be in for an unprecedented boom in demand. In Germany, measures such as an increase in the feed-in tariff, significantly higher tender volumes, a solar construction mandate for non-residential buildings, tax relief and a general reduction in red tape for construction projects are just a few of the options on the table. There are also numerous initiatives in the international arena to increase the annual expansion of PV systems, power storage systems and charging infrastructure to the desired, and indeed necessary, level.
And now we come to the variables that the optimists are not taking into account, the manufacturers and suppliers, not to mention the planners and installers which were left out of the equation. In order to adhere to the urgently needed expansion path outlined by Habeck in his memorable press conference - the so-called "photovoltaic booster" includes an increase in PV expansion of around 50 percent per year - we need more raw materials, more national and international production and transport capacities, and more skilled workers in the areas of planning, installation and service. But where is all this going to come from? In a free market, a shortage would cause prices for components and installation work to rise again quickly. In this respect, market and price developments this year are once again par for the course; that is, unpredictable.
Unfortunately, we have too little of everything to cope with the upcoming boom, except perhaps bureaucratic hurdles, doubters and naysayers. But of course, we have far too little time. What we need now is to roll up our sleeves and get started! Let's make the best of it and deal creatively with the shortages. Let's get faster and more efficient. Let's optimize and digitalize our processes. Let's say goodbye to redundant structures and paralyzing regulatory hurdles. Let's finally demand that politicians set a smart course. Let's train new skilled workers or get them from other, dying sectors of the economy. Let's reestablish production in Europe, and thus increase local value creation. Let's shorten distances and save CO2 in the process. Let's improvise where necessary and say goodbye to self-doubt. There's no time for defeatism; we have to seize the day!
Overview of price points broken down by technology in January 2022 including changes over the previous month (as of 20 January 2021):
