Russia’s invasion of Ukraine is driving up the prices of renewable energy projects, which were already facing supply-chain issues and raw material increases before the Russia-Ukraine war.
The Biden Administration and other governments around the sector have referred to dashing the transition to renewable strength assets to keep away from reliance on Russia for oil and gas. But project developers say it is almost impossible to transport faster in the near term.
The rising costs are particularly acute in the USA, where many projects were already facing increases in part because of trade tariffs targeting China.
However, like many other companies, renewable energy projects have been hit by rising prices for key materials such as aluminium and steel after the invasion and rising transportation costs due to rising oil prices, which rose more than 50% this year.
According to a new report from Wood Mackenzie and the Solar Energy Industries Association, one-third of U.S. utility-scale solar capacity planned for the fourth quarter of 2021 is at least a quarter behind, with 13% of projects scheduled to be completed this year or cancelled.
Some customers of Schneider Electric SE, which manufactures electrical products and provides technology and services to control power consumption to overcome inflation, told the company, "Just build me more and put it in storage." said Aamir Paul, the company’s US President.