Gas crisis triggers scramble for solar panels in Germany

People on the front lines of Europe’s gas crisis are scrambling to get solar panels for their homes and businesses as they face a “perfect storm” that is pushing energy prices to record levels.

In the first six months of this year, Germany saw a 22% jump in the installation of solar systems compared to the same period last year, according to data shared with the CNN Business by the German Solar Association.

This included residential and commercial uses, from small installations on private roofs to large solar farms, the group said.

For companies in the renewable energy sector, this has created a huge sales rush – and added pressure on supply chains.

Demand for solar energy was already increasing in Europe’s largest economy as energy prices soared, political incentives were introduced and adoption of the technology became more common.

But more recently, consumers have also faced rising utility bills, scorching temperatures and renewed anxiety about whether they will be able to keep warm this winter.

Since invading Ukraine six months ago, Russia has drastically reduced its gas supplies to Germany and other EU countries. Last week, it announced the unscheduled closure of its Nord Stream 1 pipeline later this month for maintenance, pushing natural gas spot prices to a new record.

For many families, the biggest fear is that Russia will completely turn off the tap this winter. The German government has already put in place a crisis management plan that could lead to business rationing if that happens.

“This demand has only gotten stronger with the war against Ukraine, which is taking place on our doorstep,” David Wedepohl, managing director of the German Solar Association, told CNN Business . “This is something that is very much on people’s minds.”

German authorities have responded to the crisis by asking consumers to conserve energy. Some municipalities have already reacted by removing basic needs such as lighting, showers and heating.

Jim Gordon, CEO of Smartflower, said geopolitical turmoil has also driven more people to switch to solar. The company supplies sunflower-shaped solar energy devices to corporate campuses, universities and homes.

“Our business is growing because there is a perfect storm of converging elements that are really elevating solar power,” Gordon told CNN Business.

“People are concerned about energy security,” he said. “An autocratic dictator can open a pipeline valve and turn off the power, but no one can control the sun.”

high sales

European industrial and energy giant Schneider Electric says demand for its solar-powered heating systems in Germany has “almost doubled” so far this year compared to the same period in 2021.

The company’s sustainability arm, which advises companies on clean energy purchases, has also reached “an all-time high” in consulting requests, according to Konstantin Elstermann, the company’s vice president of residences and distribution.

Similarly, Sonnen, a German solar battery supplier, saw its orders “more than double compared to last year” due to an “increased desire to [as pessoas] run their homes on renewable energy,” said CEO Oliver Koch.

In a statement to CNN Business Koch said his team had noticed “a further increase in demand since late February” when the war began, and was “continuously expanding our production capacity to keep up with demand”.

Demand is so high that Smartflower now expects to quadruple its sales in Germany this year, according to managing director Robert Sawyer.

“We did more business in the first six months of 2022 in Germany than in the whole of 2021,” Sawyer said, adding that sales in the country have doubled so far this year.

supply chain obstacles

These booms do not come without challenges, however.

The industry is currently facing a severe labor shortage, said Schneider Electric’s Elstermann.

“Some electricians are hired three to six months in advance,” he told CNN Business.

An autocratic dictator can open a pipeline valve and turn off the power, but no one can control the sun.

“This bottleneck almost overcomes the current shortage of raw materials and production capacity. We know that supply problems due to the pandemic are temporary, but the shortage of skilled labor remains,” said Elstermann.

Wedepohl said the industry is racing to solve the problem. Many electricians who have left their jobs in the last decade are “re-entering” the market, while carpenters are also being called in to help with installations, he added.

“A lot of installers are out there doing extra shifts, training people, bringing in new people,” he said. “It’s a challenge, but it’s definitely a moment that we hope we can overcome.”

The issue of sustainability

For now, Germany has turned to powering up its coal plants to reduce gas consumption – and ensure the country keeps the lights on.

But Chancellor Olaf Scholz has made it clear that the government is not happy about this.

“It is bitter that we now have to temporarily use some power plants that we have already closed because of Russia’s brutal attack on Ukraine. But it’s only for a while,” he said in a message last month. Similar conversations are taking place across Europe.

This year, the UK also announced a push towards other energy sources, including wind and nuclear. And for some consumers, alternatives to gas heating, such as wood-burning fireplaces, have become more popular.

This month, Austrian climate minister Leonore Gewessler called for more green energy projects to help the country get rid of Russian gas.

“We need to get rid of this dependency – cubic meter by cubic meter, windmill by windmill, PV installation by PV installation,” said CNN’s Sara Sidner, referring to the units used in building solar and wind power capacity. .

“Because we see that our dependence on fossil fuels is used as a weapon in a war,” Gewessler said.

“Winter is coming,” said Wedepohl, noting that most homes in Germany were heated with gas.

“Europeans are also in this collectively.”

— CNN’s Chris Liakos and AJ Davis contributed to this story.