Inside Germany’s Monster Solar Growth

New solar installations in Germany hit a record 7.5 gigawatts last year. That’s according to Reuters, which also reports the growth has buoyed advocates for cuts in tariff subsidies. These advocates seek to curb growth in the industry, which increases prices for customers.

2011 growth is up from 7.4 gigawatts in 2010, German network regulatory agency Bundesnetzagentur said.

Because of its tariff incentives, Germany has become the world’s largest solar market by installations, Reuters says. But it has also been cutting its incentives to prompt the industry to lower its costs further.

Germany’s main industry association BSW told Reuters demand for modules remains high despite cuts because of mild weather, low prices for solar modules, falling subsidies and fear of further incentive cuts, Reuters says.

According to BSW data, installations in Germany in the last quarter of 2011 likely reached about 4 gigawatts after Bundesnetzagentur previously said new installations in the January- to September period stood at 3.4 gigawatts, Reuters says.

The current installation rate could generate a 15 percent cut in tariffs on July 1 as a result of the feed-in law for renewable energy. Feed-in tariffs are subsidies needed for the industry to be competitive versus fossil fuels.

To force the industry to lower its prices and become more competitive, the German government has been searching for ways to curtail support. Large cuts to feed-in tariffs in recent years had already aimed at shrinking the market.

In November, the German government issued a proposal to reduce new installations to 1 gigawatt, which would knock it from its perch as the world’s largest solar panel market, Reuters says.

German Economy Minister Philipp Roesler has called for cuts in clean energy subsidies for wind, solar and biomass installations to bring them in line with market realities, Bloomberg reports.

According to Bloomberg, Roesler’s comments highlight tensions in the German government over the future of clean energy subsidies as solar companies struggle with slowing demand and rising competition.

Environment Minister Norbert Roettgen has rejected Roesler’s proposal to curb future solar panel installations in Germany to 1,000 megawatts a year.

Roesler said the changes will require investments in new gas- and coal-fired power plants as well as 2,800 miles of power lines.

Germany seeks to get at least 35 percent of its power from renewables by 2020, compared to about 20 percent now.

To read the full article by Reuters cited in this story, click here

To read the full article by Reuters cited in this story, click here

To read the full article by Bloomberg cited in this story, click here



Tags: Policy , Solar

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