Strategy Shift for Solar Industry in Germany?

Jan 11th, 2012 | By | Category: Articles, Featured Posts


During the World Climate Summit in Durban, South Africa, where Germany received the “Country Leadership Award” in recognition of the nation’s consequent expansion of the renewable energy sector, the public discussion on further PV subsidy cuts intensified. Recent proposals by the German Federal Government and leading members of parliament to further drastically scale back PV subsidies or, alternatively, limiting newly installed PV plants to a capacity of 1,000MW have been criticized by the nation’s Federal Association for the Solar Industry (BSW-Solar), according to a news report on “BSW-Solar calls upon the Federal Government to make a clear commitment to the energy strategy shift [the phase-out of nuclear power], to climate protection and to solar energy,” said Carsten Körnig, CEO of BSW-Solar. “The German PV industry would not be able to survive” a capacity limit of 1,000MW, added Körnig. Also, leading executives from the PV industry criticized the plans.

Additionally Reuters reported in late December that German solar power producers raised electricity output in 2011 by 60 percent over 2010 to 18 billion kilowatt hours. According to lobby group Federal Association for the Solar Industry (BSW-Solar), solar power producers grabbed more than 3 percent of total power output volumes. The sector already produced enough power to supply some 5.1 million households, one eighth of all households or the entire state of Thuringia, BSW-Solar said. “Solar energy has become an indispensable ingredient for a successful energy strategy shift,” BSW-Solar CEO Carsten Körnig said. Power from photovoltaic (PV) installations was the fastest growing segment within all German power derived from renewable sources in 2011, energy association BDEW data shows.

German PV-growth only with reliable conditions

So-called green power captured 19.9 percent of the power mix in 2011, compared with 16.4 percent in the previous year, BSW-Solar said in preliminary data earlier this month. Within the fifth of total power supply accounted for by renewables, solar raised its share to 3.2 percent from 1.9 percent year-on-year, the figures showed. Körnig said costs have been halved since 2007 and a pro rata cut in subsidies since then has been absorbed. “The solar industry stands by its commitment to cut costs radically,” Körnig said. Feed-in tariffs paid to producers will fall by 15 percent on Jan. 1, 2012 and by another 9 percent in mid-2012 as the government aims to force the industry to cut costs faster. BSW said if there were reliable conditions, the industry would adhere to its target of supplying 10 percent of all power consumption by 2020.

On the other hand, some industry observers opine renewable energy was driving up prices for power supply. In order to provide relief for consumers and businesses alike, they recommend the German government should reduce subsidization for offshore wind energy and photovoltaic plants – as well as amending Germany’s feed-in law EEG.

And in future a new role for the German PV companies?

Weekly Die Zeit carried a report on what is deemed to be the “Solarification of the World”. As the German PV industry is ailing, researchers are about to develop many new ideas which are expected to fundamentally change the industry. In this process, German PV companies are expected to play a significant role: “Germany has manufacturers and specialists on all levels of the production chain,” said Nupur Sinha, a PV analyst for market research firm Frost & Sullivan. “This will help to overcome the deceleration of the [PV] industry,” she said. Within the next decade, “the most important innovations will come from Germany and the United States, while China will establish itself as manufacturer of solar modules.”

Is Germany really quietly implementing an energy strategy shift?

However, the question should be discussed whether the EU Commission in Brussels is ignoring Germany’s energy strategy shift. He of all people, the German EU Energy Commissioner Günther Oettinger (CDU) is pushing forward with plans to re-establish nuclear power generation in the continent’s energy mix. The EU Commission advocates the construction of 40 new nuclear plants by 2030 in Europe. In a so-called roadmap, the EU Commission outlines its plans of increasing the share of nuclear energy, which it says represents by far the largest share of CO2-free energy generation. The document by Oettinger also hinted at possible expansion of subsidization of investments in new nuclear power plants.

Is Germany a scary outrider?

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