German wind sector fears job cuts and order slump – IG Metall survey
Clean Energy Wire
Germany's wind companies are operating at nearly full capacity, but employee representatives are increasingly concerned about the future, with many expecting jobs cuts and a sharp decline in orders as the government seeks to cut costs in the energy sector with a major renewables reform, showed a survey by trade union IG Metall.
About 25 percent of works council representatives surveyed expect orders to decline over the next two years. Just 18 percent expect their companies to increase their workforces, down from 32 percent in the previous survey.
At the same time, works councils assessed the outlook for Asia’s wind sector positively, while 54 percent had a negative assessment of developments for Germany’s domestic industry. The survey covered 34 companies employing 27,700 people.
Respondents cited growing competition from China, political uncertainty, a lack of grid connections and insufficient industrial policy support as the main reasons for their pessimism.
They called on the federal government to give the wind sector greater attention in its industrial policy. IG Metall criticised economy minister Katherina Reiche's reform plans, which would reduce compensation for curtailed electricity from new wind turbines and solar panels in areas with limited grid capacity. The reforms could slow wind expansion, and push jobs, investment and manufacturing capacity to other European countries and China, the union warned, echoing earlier industry criticism.
The German parliament, meanwhile, is set for a first debate of the government’s reform plans on 24 September. The government proposed the reforms in response to a combination of EU deadlines, debates about the costs of renewables support, and electricity grid bottlenecks. A 2024 EU power market reform, decided in the wake of the energy crisis exacerbated by Russia's war against Ukraine, requires Germany to adapt its renewables support system. From 1 January 2027, new state-backed support mechanisms for wind, solar, geothermal, hydro and nuclear power must include a clawback provision to prevent windfall profits when market prices are high.
Ahead of the parliament debate, the wind industry association BWE and citizens’ energy groups called on lawmakers to ensure reliable framework conditions for renewables projects by local communities and other citizen-led initiatives. They demanded a separate state support auction for citizens’ energy projects, and better conditions for bank loans. The strict requirements regarding ownership structure currently make it difficult for banks to sell a project to new owners in the event of insolvency, the groups said.