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Solar coaster of stock shortages versus rise in demand

Simon Dudson, CEO of The Little Green Energy Company, explains.

Renewable energy has seen a steady rise in popularity over the past couple of decades, but not many of us would have expected the recent sudden incline that has been so severe it has led to a mass stock shortage. It is hard to deny the warning signs weren’t there though… Although most of us are still in a relative degree of shock regarding the rising energy bills and fuel prices, it would be naïve to assume a range of devastating events (not least the pandemic and Ukraine crisis) would not create shockwaves across industries. Part 1: The rise in demand across the solar industry As mentioned, the popularity of renewable energy has been on the increase for quite some time. People have become more eco conscious, there is more pressure on the government to keep it green, and the reality of climate change is, that the outlook is truly bleak unless we act together and act fast. These factors alone have kept the energy industry ticking over at a healthy pace. But then the spikes in demand came along – the instant impact events and changes such as the severe rise in fuel and energy prices. If these devastating price hikes looked like they may be temporary with some reprieve on the horizon, the sea change in energy preference may not have occurred at all. But the truth is, there’s no sign of price reductions on the horizon or help on its way. So, many have had enough. Enough to ‘take things into their own hands.’ And that is what has largely led to the rise in demand across the renewable energy markets. Make fuel prices too high, people will turn to electric. Make energy prices too high, people will turn to powering their homes with solar.

Part 2: The stock shortage of renewable products A rise in demand in any industry is usually news that is welcomed with open arms from within. But what happens when the incredible rise in demand can’t be met – not by a long way? A perfect storm. Logistical chaos. Again, there are various reasons for stock shortages. Most notably, you could point toward transportation issues. And this issue alone is exacerbated by various other issues and causes. International conflict results in borders and corridors being blocked and bottlenecked. Pandemics and lockdowns result in a decline in delivery personnel availability and general industry activity. Severe changes in legislation can result in delays at ports and with documentation, etc. The boom in the renewable energy industry should be a positive for every party involved – not to mention mother nature herself. But the blast of this boom has been more sudden and powerful than anyone was prepared for. What next: how to deal with the solar coaster we are all riding on The struggle is real, and it won’t go away by itself. There is no easy fix, that is for sure, but that doesn’t have to mean improvements can’t be made – and made soon. We need to do everything we can to work together and for one another – across departments, across disciplines and across each area of the industry. It is the only way we can make any wiggle room for these blockages and bottlenecks. This may come in the form of improved economies of scale through enforced efficiencies to make the longer lead times on materials and products more acceptable. Or better customer service and management of expectations to counter extended fulfilment timelines. Whichever strategies are used, they need to swift, effective, and carried out in universal agreement and understanding. Our governments can play their part too. After all, it is in its interest as much as ours. If it is going to remedy the shortages, the rise in demand and the blockages, it needs to act decisively and swiftly to ensure the loss of trade and progress is minimised from here on. And once this perfect storm has subsided, it would probably be a good idea to start preparing in case another comes along. As the quote goes, ‘The definition of insanity is doing the same thing over and over again and expecting different results’.


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