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Challenges in the energy sector: Why the current market situation is a warning sign

...and how we can still get projects off the ground safely.

When more and more companies in the energy sector find themselves in financial difficulties, it is much more than a series of unfortunate individual cases – it is a signal to the entire energy transition in Germany. Even innovative, well-positioned players are vulnerable when market conditions fluctuate, funding decisions are delayed or approval processes stall. 
The year 2025 makes it clear: technology is not the problem – the framework conditions are.

 

Solarpanels on a field
The solar industry is currently feeling the effects of the uncertain situation particularly keenly.

Which areas of the energy market are particularly affected

The tense market situation is having a particular impact on companies that have to make high upfront investments or are heavily dependent on regulatory processes:

  • Installation companies & dealers (solar/PV): tight margins, high pre-financing, fierce price competition
  • Project developers & system providers: dependent on financing, interest rates and approvals
  • Manufacturers of energy components (e.g. battery technology): capital-intensive production chains, fluctuations in demand
  • Planning and engineering firms: indirectly affected by project delays, funding uncertainties and risks in the order chain
In the background of the picture, renewable energy systems such as wind and solar; in the foreground, a staircase on which euros are tumbling down.
Instead of planning security, there are long processing times for funding applications and a lack of a robust and reliable approach.

Why the situation is tense – the main causes

The literature and media-based analysis reveals several overlapping drivers:

  • Strong price and competitive pressure, especially from imports
  • High prices in general and inflation, which also put pressure on production and logistics chains
  • Regulatory uncertainty, constant programme changes, complex funding landscapes
  • Delayed processing of funding applications, especially for BAFA programmes

These factors create a climate in which companies are expected to plan without being able to do so reliably.

[Translate to English:] View von above on a table with plans and employees who talk about it
Planning companies are also often unable to act as they wish because approvals and funding decisions take a long time to come through.

How we as planning partners create stability for our clients

Even though external market conditions are currently challenging, clients can rely on one thing: professional planning reduces risks and keeps projects moving forward. For us, this means combining technical excellence with organisational reliability – so that energy projects can be implemented safely, smoothly and in a structured manner despite uncertainties. We do a lot to achieve this:

Funding realism instead of funding illusion

Delayed subsidies are one of the biggest risks in the current situation. We ensure that you...

  • receive realistic schedules that take BAFA processing times into account,
  • are aware of planning variants that can be implemented without delays,
  • know early on which subsidy components could become critical.

Technical depth, defined standards, clearly documented results and traceable project statuses ensure that projects deliver high quality regardless of the market environment. This process reliability protects clients from external uncertainties affecting the project.

Increase project robustness – regardless of market volatility

We develop planning and system variants that are...

  • are technically resilient,
  • economically viable,
  • and stable regardless of funding.

This keeps your projects on track even when market conditions change at short notice.

Structured communication & risk management

Risks – whether related to approvals, supply chains or interfaces – are identified early on, prioritised and actively monitored. This results in robust schedules and realistic project paths that cushion fluctuations in the environment.
Regular, clear coordination creates transparency and prevents planning standstills. Proactive communication keeps clients informed at all times and enables them to make timely decisions before challenges turn into delays.

Through clear milestones and closely timed communication, we ensure that...

  • Delays are identified early on,
  • Alternatives are developed promptly,
  • Consequences can be avoided.

In short: we manage complexity – so that you can maintain planning security.

Which structural measures politicians and society must now initiate

The current situation clearly shows that companies alone cannot stabilise the energy transition. Structural adjustments and planning security are needed to ensure that projects remain plannable and market players do not come under further pressure.

A blue, DNA-like trail that is supposed to embody data
Data and process digitisation is a building block for faster processing times.

Pilitics: faster, reliable, risk-hedging

Digital and faster funding processes
  • Expansion of BAFA processing capacities
  • Clear deadlines (service level agreements)
  • Fully digital application systems

The processing capacities of funding agencies must be massively expanded and the processing speed increased. This is because long processing times for BAFA applications and proof of use directly lead to liquidity bottlenecks for companies throughout the chain. Political investment in personnel, faster data and process digitisation, and fixed service levels (e.g. maximum processing times) are necessary to eliminate the ‘funding bottleneck’.

Financial security instruments for SMEs, such as KfW bridging loans, would be desirable in order to provide simplified access to liquidity in the meantime.

Acceleration of approval procedures, for example through central contact points with automated, digital review processes and binding decision deadlines. This requires legislative measures, which are already on the national and European agenda. Now they must be implemented quickly. Fast, reliable approvals prevent project delays and thus liquidity bottlenecks.

Procedures should also be simplified in terms of content and not further complicated. In this context, particular attention should be paid to the negative consequences that implementation of the LAWA guidelines would have with regard to water thermal energy.

Society / public sector (local authorities, clients, investors)

 

  • Public contractors as reliable partners
    Local authorities, housing associations and other public contractors should review their payment terms and tender conditions: where possible, longer payment terms should be avoided and verification/settlement processes standardised in order to reduce the risk of insolvency along the supply chain.
  • Public investment serves as a market anchor 
    ​​​​​​​When local authorities invest in heating networks, building renovations and municipal PV initiatives, and do so early on rather than at the last minute, they not only take on a pioneering role and benefit more quickly from lower operating costs, but also stabilise order chains – and prevent projects from stalling due to fluctuations in demand.

Conclusion: The energy transition needs stability – and pragmatic solutions

  • The current challenges in the energy sector are a warning sign. They show that technical feasibility alone is not enough. Without reliable funding processes, predictable financing and stable market structures, even innovative projects can falter.
  • The energy transition needs speed. But above all, it needs predictability. Contact us if you, as a client, want to plan with certainty despite these uncertainties. We stabilise projects, create transparency, manage risks and ensure that heating network, building and energy system projects are implemented reliably – regardless of how dynamically the market develops.

Sources

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