A massive solar skills shortage

First off, here’s a shocking stat 👉🏽 A 2020 Survey by the Electrical Contractors’ Association revealed that 48% of those trading in solar and storage lacked access to skilled employees.

Germany, the largest solar market in Europe, is predicted to face a shortage of 5 million workers by 2030 due to demographic shifts. If this issue is not addressed, then Solar companies can expect to stagnate, losing shareholder confidence and could be outperformed by their competitors who took action. Therefore, bridging the market is essential to stay afloat in the industry.

Keeping your competitive edge when recruiting

Solar energy remains the most cost-effective way to generate electricity, with an impressive price drop over the last 15 years. Germany, the leading Solar Powerhouse in Europe set fixed prices on solar energy in an attempt to curb dramatic costs affecting more volatile energy sources in gas and oil.

Solar financial challenges and shareholder concerns

Although many shareholders may consider skill shortages to be a temporary challenge, some dislike uncertainty and may grow frustrated if they perceive the skills shortage is interrupting a company’s ability to seize growth opportunities. Skills shortages may well realistically lead to project delays, increased costs and operational inefficiencies as companies look to borrow money for their projects.

Borrowing in a high-interest economy

And here’s the problem: Some companies are having to rely on financing to develop these projects. The higher interest rates can increase the cost of borrowing, making it more expensive to fund renewable energy initiatives. As a result, the financial viability of some projects may be compromised.

The dark side of long-term Solar contracts

This is the kicker – many long-term contracts selling energy at fixed prices are typically made BEFORE projects are developed. With the surge in global inflation, these fixed prices have become increasingly less of an advantage than first thought. The costs of producing and maintaining projects have risen significantly, made worse by the growing demand for renewable energy projects. This negatively affects talent acquisition, reducing demand for talent in non-economically viable projects.

Solar skills shortage and project safety

Another worrisome potentiality bothering shareholders is that the skills shortage may well lead to inexperienced individuals managing high-stakes, large-scale projects, raising concerns about safety and project financing.

Dramatic effects on solar candidate acquisition

All of these shareholder concerns listed above and below can have dramatic effects on candidate acquisition, with candidates possibly overlooking its potential and focusing only on instability. Some shareholders might reconsider their investments altogether, diversifying into other industries for more immediate returns and low risk.

• The S&P Global Clean Energy Index fell by 20.2 per cent in two months, highlighting the underperformance and decline in value of renewable energy companies.
• The index is on course to its worst annual performance since 2013, showing a worrisome trend.
• Some major players in Solar have already announced cuts to their growth expectations.
• Some analysts argue that renewable energy companies’ business models are ill-suited to a high-interest rate world. Solar companies have experienced significant share price declines.
• The median company in global solar panel manufacturing now trades at an EV/EBITDA multiple of nine times, down from 16 times a year ago according to BloombergNEF.

However, many shareholders agree skills shortages may only be a temporary challenge. A large part of the value destruction is over…. With some investor confidence picking back up, and some reinvestment into Solar, rather than shorting stocks, could things be on the rise?

What are the solutions to this Solar hiring crisis?

Hiring the best skilled solar professionals and generating streams of talent is crucial for solar companies. Securing the best solar talent will ensure greater efficiency and security of projects, reducing costs associated with a lack of skilled employees and alleviating the pressure of other financial burdens. Solar companies would benefit by adopting a strategy that involves both long-term and short-term solutions.

Solar learning processes

Including learning processes in company corporate values is a great long-term strategy. Each stage of development is a distinct learning opportunity for employees, with accumulated knowledge vital for using skills in new contexts. Maintaining accumulated learning in-house will limit the issue of skills shortage in case of turnover.

The short-term solar hiring solutions

Attend industry learning events

As skills shortages pile on the pressure industry events are a great way to inform and educate the workforce about complex projects and the high demand for roles. “Installing the Future. NOW!” is a regular UK event hosted in Birmingham. This event brings together industry leaders across the renewables sector, where visitors are exposed to the fitting of innovative solar panels whilst learning the true capabilities and scalability of these technologies.

Look for transferrable skills in other sectors 

Companies may look to energy utilities and industrial sectors because many skills can be transferred. Around 70% of oil & gas jobs have some skill overlap with low-carbon roles. The span of advertising is being stretched to reach people from other industries and communities where there may be limited long-term opportunities, such as military veterans.

A long and short-term solar recruitment solution

In conclusion: recruitment collaboration is key

To tackle these issues, governments, companies, and educational institutions must actively support facilitating worker mobility, standardised certifications, and funding sources for renewable energy recruitment. National governments should incentivise comprehensive training and reskilling programs and encourage partnerships with academic institutions to bring in the next generation of talent. Companies should partner with the recruitment sector, to find hard-to-acquire talent for urgent roles. Securing valuable long-term partnerships will enable solar companies to reach a whole range of seniority years down the line, keeping growth plans alive.

Are you ready to be the beacon of change in the Solar industry?

At Executive Integrity, we understand the critical need for skilled solar professionals to fuel the future of renewable energy.

Partner with Executive Integrity and secure the talent that will keep your solar projects shining brightly for years to come.

Our expert recruitment services can connect you with the top talent you need to drive efficiency, ensure project security, and reduce the financial burdens associated with skills shortages.

Don’t let the solar skills shortage extinguish your growth plans.