We're lacking something critical, not only in Germany, but I'll get to that. First, let me point out what we' re not lacking: solar panels. Contrary to the mid-year projections of a number of analysts, there is no solar boom in China and no extreme game of catch-up in installation figures. Rather than the anticipated new installations on the order of 25 to 30 gigawatts projected for the second half of the year, expectations have now been dialed back to less than 20 gigawatts of new capacity. But this volume can easily be accommodated by existing production capacities for wafers, cells and modules, which means that the module bottleneck I was anticipating, especially for products manufactured in China, will not materialize. New deliveries from Asia continue to flow, all is quiet, and the availability of nearly every technology is keeping pace with current demand.
This calm is also reflected in module prices. After some short-term price drops at the end of the third quarter aimed at quickly drawing down inventories and making room for new goods, the market is now largely back on track. The prices across all panel types have stabilized - only the prices for high-efficiency and bifacial products have seen a slight uptick but this can also be attributed to natural fluctuations in the spot market. Also, just last month, I changed the performance classes I am tracking and thus the boundaries between low cost, mainstream and high-efficiency products, with the result that the slightly cheaper modules with 290 watts were excluded from the average price of the latter class. The cutoff for high-efficiency modules is now 295 watts, and for mainstream modules, 270 watts.
So what are we lacking in this now saturated market?
What is currently still holding back the rapid implementation of the energy transition and the fast switch to purely renewable power generation, apart from ever-changing raft of political slights of hand and the refusal of the "Groko" (Grand Coalition in the German Bundestag) to finally do away with the 52-gigawatt cap in Germany? Thanks to the Fridays-for-Future movement, there is broad-based support among the population for the exclusive use of renewable energy in the near future and a public willingness in principle to invest in renewables - by installing private PV plants, for example. So, the future of the photovoltaic industry looks secure - everything is fine, right? Unfortunately, there is one big catch: the shortage of skilled workers!
At the beginning of the current decade, everything was still in running smoothly; all in the PV business specialized companies were growing and thriving and training new employees. Companies in the traditional electrical engineering sector shifted to PV plant design and construction, and many hundreds of thousands of workers had a place in the renewable energy sector. But then came the great slash-and-burn campaign. In several stages, the Renewable Energy Act (REA) in Germany and incentives in many other European countries were curtailed and downgraded to such an extent that the building of new plants simply became unattractive and the markets tanked. There was mass migration of skilled workers looking for new fields of work that were safe from the whims of policy makers. The few companies that have remained loyal to the industry despite all this are now desperately trying to cope with the growing workload with much smaller teams.
Some of the companies that have recovered are trying to win back their former employees - experienced planners, for instance, and especially installers - through attractive working conditions and salaries. But other companies from less turbulent industries are paying better, and the jobs in those fields are presumably safer. In Germany at least, there is a major shortage of workers and professionals in the PV sector, with the result that many orders for installations are either not accepted at all or are started only after very long delays. According to surveys by the start-up www.installion.eu, in recent months alone the lead-times for electrical work have risen considerably from an average of 2 to 3 months in June to as long as 5 months in September. Most installation companies are no longer even accepting smaller orders in the end-customer sector for this year.
This installation bottleneck alone has prompted fears that climate targets in the electricity sector either cannot be achieved at all or can only be achieved very slowly. In other European countries the situation is not much better. In places where in the past there was essentially only large-scale plant construction - places like Spain and the UK - the expertise for small, smart installations with energy storage and optimization for on-site consumption is completely lacking, even if there were installers to build them. In many countries, there was either never a large market to begin with or it was so prematurely nipped in the bud that many skilled workforces have either moved on to greener pastures or were simply never built up in the first place. In France, after a long dry spell, demand for small systems is now brisk again, albeit with exactly the same problems as in Germany. The French government never tires of inventing fresh regulations to make new builds complex and installation difficult. Only in markets such as Italy and Southeast Europe does there seem to be no shortage of skilled workers, but for the sole reason that there is no need for them due to the lack of a functioning market.
So what needs to be done to improve the situation?
First and foremost, the market players have to look after the next generation by training new specialists themselves. To this end, educational initiatives by the Germany's Federal states and other government support, such as tax relief and reductions in social security contributions for companies providing training, would of course be helpful. These measures can only be effective over the longer term, of course. In order to overcome the bottleneck in the short term, the start-up www.installion.eu has entered the picture and developed an online marketplace for electrician capacities. By specifically attracting electricians from other sectors, the young company states that it already supports a double-digit number of utilities, manufacturers, wholesalers, and large installation companies in the structured acquisition of installers. The company's customers can book electricians through the platform for their upcoming projects on the basis of a subscription, which can be cancelled on a month's notice.
This offers some hope that in the future there will be far fewer promising photovoltaic projects that never leave the drawing board for a lack of personnel to build them.
Overview of the price points by technology in October 2019 including the changes over the previous month (as of October 21, 2019):
