Sales challenges and supply issues of key storage components are other issues that energy storage manufacturers need to cope with in the current health and economic crisis. Travel bans and regional ‘shelter-in-place orders’ create significant hurdles for late-stage project implementation which requires on-site personnel.
"This has led to project delays and additional costs which, if they continue long enough, will lead to projects missing crucial deadlines - such as ITC qualification - which could destroy project economics,” said Brett Simon, Wood Mackenzie Senior Research Analyst.
A few forward-thinking developers have built longer delivery timelines into their contracts, allowing them to shift projects back from the original proposed commissioning date. Going forward, however, these problems are likely to escalate as permitting agencies for energy storage facilities begin to pull back personnel as further travel limits are imposed.
Product supply remains less of an issue today, yet this could change in the coming weeks. Most North American storage developers source batteries from Asian manufacturers, which are ramping back up as coronavirus impacts abate in manufacturing hubs. Delays will hence be on the order of weeks, rather than months, for product delivery.
Things are more critical for components made in the United States and Canada. “There is some murkiness around the supply of components manufactured in North America, such as steel enclosures for larger scale non-residential projects,” Simon commented. “Developers remain unsure how much of an impact manufacturing slowdown in the US and Canada will have and continue to monitor the situation closely.”