The COVID-19 pandemic has affected several industries, causing a standstill in daily life everywhere. Its effects have also translated onto the industry of renewable energies, causing major issues in its production. Part of the overall consequences is that the clean energy movement has been stalled worldwide because of the outbreak.
Reduced growth rate
Before COVID-19 hit, solar energy growth was projected to grow in capacity by 121 to 152 gigawatts this year according to Bloomberg Energy New Finance. The pandemic has prompted them to reduce their prediction down to 108 to 143 gigawatts. Part of the reason for this is because the production for the most part has been halted, and in turn so has the potential growth for such renewable energies.
Force majeure causing delays
The concept of force majeure has been thrown about in relation to this outbreak. It’s applied when an event happens beyond the control of both parties that they cannot fulfill the terms of the contract within the agreed upon conditions. Several industries have used this in order to remove the liability if they do not finish projects on time. As a result, this has affected the production of both solar panels and wind turbines. Those with the expertise, such as professionals finished with their working at heights training in the case of wind turbines, cannot fulfill their tasks because of the call for social distancing and quarantine.
Bloomberg has analyzed the possibility of lower return on investments because of this health crisis. Right now, companies and governments alike are focused on addressing the potentially disastrous effects on the economy due to work being suspended. Because of this, the investment and initiatives for renewable energies have taken a backseat while they address this more pressing issue. Bloomberg explains that the lack of demand for such energy sources will lead to lower ROIs than usual.
Despite all of this, the push for green movement, particularly locally-sourced renewable energy machinery, is still going strong. In fact, with the equally negative effect on fossil fuels, many see this as the opportunity to encourage these safer, more environmentally-friendly alternatives. Executive Director Faith Birol from International Energy Agency says that the pandemic shouldn’t stop the efforts taken to move into the clean energy movement. He argues that we should not let a health crisis allow us to forget or shift our priorities completely.