Home » Jobs » Merkel’s Green Jobs Ambition Stalls With Cuts for Solar

Merkel’s Green Jobs Ambition Stalls With Cuts for Solar


Enlarge image
Merkel’s Green Jobs Drive Faltering

Merkel’s Green Jobs Drive Faltering

Merkel’s Green Jobs Drive Faltering

by Harold Cunningham/Getty Images

Solar panels at the Freiburg Solar Settlement in Freiburg.

Solar panels at the Freiburg Solar Settlement in Freiburg. Photographer: by Harold Cunningham/Getty Images


Enlarge image
Germany's Chancellor Angela Merkel

Germany’s Chancellor Angela Merkel

Germany's Chancellor Angela Merkel

Alessia Pierdomenico/Bloomberg

Angela Merkel, Germany’s chancellor.

Angela Merkel, Germany’s chancellor. Photographer: Alessia Pierdomenico/Bloomberg


Enlarge image
Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Jochen Eckel/Bloomberg

Employees polish a solar panel at the Solarworld AG plant in Freiberg, Germany.

Employees polish a solar panel at the Solarworld AG plant in Freiberg, Germany. Photographer: Jochen Eckel/Bloomberg


Enlarge image
Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Merkel’s Green Jobs Drive Faltering With Cuts for Solar

Qilai Shen/Bloomberg

Employees assemble photovoltaic panels at Suntech Power Holdings Co.’s factory in Wuxi, Jiangsu Province, China.

Employees assemble photovoltaic panels at Suntech Power Holdings Co.’s factory in Wuxi, Jiangsu Province, China. Photographer: Qilai Shen/Bloomberg

German Chancellor Angela Merkel’s
effort to create jobs in renewable energy is faltering as
subsidy cuts and competition from Chinese manufacturers forces
the industry to stop hiring for the first time in eight years.

Employment in Germany’s clean energy industry probably will
“stagnate” this year after creating about 31,600 jobs a year
since 2004, said Claudia Kemfert, senior energy analyst at the
DIW economic institute in Berlin. Four German solar companies
filed for protection from creditors since December including Q-
Cells SE, once the world’s biggest cell maker.

Merkel is paring solar incentives after a boom made Germany
the largest global market for the technology, piling pressure on
domestic manufacturers as Chinese manufacturers led by Suntech
Power Holdings Co. (STP)
take market share. The forecast underscores
the difficulty Germany will have in reaching its ambition to
replace nuclear power within a decade.

“The German government is running the German solar
industry into destruction,” Hans-Josef Fell, a Green Party
lawmaker and one of the inventors of Germany’s renewable energy
subsidy system, said April 17, adding that he’s concerned about
more “insolvencies, plant closures and job losses.”

Germany led industrial nations in promoting renewables
since 2004 with the first above-market rates for solar energy.
It prompted the U.S., Britain and Japan to follow with similar
initiatives aimed at generating “green jobs.”

Global Concern

In the U.S., President Barack Obama’s ambition for a
“Sputnik moment” spurring renewables has crumbled into
partisan bickering about whether he was right to subsidize
Solyndra LLC before it failed. That’s halted debate on tax
credits that wind turbine makers rely on, leading Vestas Wind
Systems A/S (VWS)
to threaten 1,600 jobs in the U.S. The concerns
about green jobs also are resonating in the U.K., suffering its
first double-dip recession since the 1970s.

“As major economies face tougher fiscal conditions,
indications suggest growth is slowing” for renewables, U.K.
Energy Secretary Ed Davey said as ministers from 23 nations met
in London on April 25. “New industries could suffer.”

The Environment Ministry in Berlin counted 381,600 people
working in the clean energy industry last year, up 4 percent
from 2010, a fraction of Germany’s total workforce of about 41
million. Growth in wind and solar jobs helped cut the
unemployment rate to 6.7 percent, the least in two decades. The
Federal Labor Agency will release monthly jobs data on May 2.

‘Step Backward’

“We’re seeing a major step backward regarding clean-energy
jobs because of a lack of strategic industry policy coming from
the federal government,” Steffen Streu, a spokesman for the
economy ministry in Brandenburg, said by phone on April 18, a
day after First Solar Inc. (FSLR) said it would close its biggest
European plant located in the state. “It was always said that
each coal job given up will re-emerge in the renewable sector.
That’s not the case at the moment.”

Solar manufacturers are feeling the biggest pinch. German
Environment Minister Norbert Roettgen, responding to concerns
that a surge in solar installations was driving up the cost of
electricity, is planning monthly cuts for subsidies to match the
decline in panel prices.

A surge in output from Chinese panel makers such as Suntech
have cut the price of a solar cell 67 percent to 48 cents per
watt
of electricity generated, according to Bloomberg New Energy
Finance data. Germany and the U.S. so far haven’t backed calls
from companies including Bonn-based Solarworld AG (SWV) to rein in
what they say is illegal dumping by the Chinese.

Roettgen’s View

Roettgen said the industry will have to adjust to live with
lower subsidies, though he expects employment levels will
continue to rise across the renewable energy industry. The
government also is providing incentives for wind farms,
especially offshore.

“The success story in the job sector continued last year,
and everything points to that it will continue this year,”
Roettgen said April 25 in Berlin. “If enormous overcapacity
exists in the solar sector, this will lead to adjustments that
we can’t and shouldn’t stop with excessive subsidies.”

Sixty-two percent of Germany’s photovoltaic suppliers
expect to dismiss workers, the VDMA machine makers’ association
said on April 2. Its members expect sales to drop as much as 22
percent on average this year.

Q-Cells, Solon SE (SOO1), Solarhybrid AG (SHL) and Solar Millennium AG (S2M)
all filed for insolvency since December. Solar Millennium, a
developer that had 318 workers in June, fired its remaining 40
employees on Feb. 28.

Blow for East

Eastern Germany, where the solar industry settled to reap
state and European Union subsidies meant to make up for the
closure of strip mining, has been hit hardest by the collapse.

Q-Cells employs about 1,300 people in Saxony-Anhalt and
Berlin. First Solar, the biggest U.S. solar manufacturer, said
on April 17 it will close its manufacturing site in Frankfurt an
der Oder in Brandenburg by the end of the year. That plant
employs about 1,200.

“Thousands of solar jobs are at risk,” said Joerg Mayer,
managing director of the BSW-Solar lobby. Companies that employ
110,000 people are bracing for a “drastic downturn.”

Job cuts may extend to the wind energy industry, which
employs about 100,000. Turbine makers including Siemens AG (SIE),
Vestas and Hamburg-based Nordex SE (NDX1) are seeking to reduce costs
as they lose market share to Chinese rivals Xinjiang Goldwind
Science Technology Co. (2208)
and Sinovel Wind Group Co. (601558)

‘Struggle’ for Wind

“The wind industry struggles with low margins,” Felix Ferlemann, chief executive officer of Siemens’s wind power
division, said April 16. “This is not a sustainable situation.
We are under pressure to reduce costs quickly.”

It’s not certain that all of the bankruptcies in Germany
will lead to significant job losses.

Solon was snapped up by Middle Eastern solar-cell maker
Microsol in March. The Berlin-based company, which since
mid-2011 reduced its workforce by 25 percent to about 600, had
to fire “only 18 employees,” said Karin Evers, a spokeswoman.

“I had expected a stagnation in the solar sector for the
past years, and it never materialized,” said Marlene O’Sullivan
from the German Aerospace Center’s Institute of Technical
Thermodynamics, which helps compile the renewable energy
employment data for the government. “Any forecast is clouded by
uncertainty. If the German solar market collapses by 50 percent,
that doesn’t mean 50 percent of jobs will be gone.”

Q-Cells shares climbed 21 percent in Frankfurt on April 23
after its administrator said several financial and strategic
investors had shown interest in the company.

The DIW predicts the industry will create jobs in the long
run. It estimates renewable energy companies may employ about
600,000 in 2025.

“Innovative companies will still have a chance, they have
to go for research and education and export markets,” Deputy
Environment Minister Katherina Reiche said in an April 19
interview. “If a company just counts on subsidies, it can’t be
successful as a global player.”

To contact the reporter on this story:
Stefan Nicola in Berlin at
snicola2@bloomberg.net

To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net

Please enable JavaScript to view the comments powered by Disqus.

Article source: Article Source


Filed under Jobs and tagged , , , , .

Leave a Reply