German Government Looks to Pass Solar Cuts by Next Month

by Trefis Team
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The German government is set to pass the new regulation to implement the steep subsidy cuts on solar projects by July 7. [1] The cuts, which are applicable from the beginning of this quarter, are set to reduce solar installations in the country by more than 50%. The Merkel government proposed the new cuts after Germany added a record 7.5 GW of solar capacity despite reductions in government support. The new rules will curtail excessive installations despite the falling cost of solar power. The move has been opposed by some political figures who are concerned that the latest plan will put further pressure on the struggling solar industry. Germany is a major market for Suntech Power (NYSE:STP).

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Major cuts

The latest plan to cut support to the solar industry met with opposition from officials who were concerned that the bill could hurt employment by curtailing the green energy industry. [1] Due to the resistance, the bill is to be presented to an arbitration panel on June 13 for consensus. Federal officials have said that if the panel reaches consensus on the bill on the day, it can be passed by July 7. According to critics, the latest cuts would result in further deterioration of the solar industry in the country. German panel manufacturers have struggled to fight competition from low-cost Chinese firms such as Suntech Power.

Germany plans to cut annual installations in the country by more than 50% over the level last year. The government plans to add around 3 GW of solar capacity every year till 2020 to meet its plan of having 52 GW of solar plants by the end of the decade. Despite the cuts, industry executives say that solar will still be profitable for rooftop installations in the country. We expect the cuts to pass despite the presence of opposition.

Germany is a key market for Suntech Power and contributes to a significant portion of its sales. Despite a shift in solar demand to emerging markets, the changes to Germany’s clean energy policy will have an impact on the sector’s future prospects.

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Notes:
  1. Germany May Pass Solar Subsidy Cuts by July 7 After Bill Blocked, Bloomberg [] []
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  • commented 2 years ago
  • tags: YGE FSLR TSL STP
  • Germany is only one third of America in population count ... There is no other way for you to help solar companies besides goverment.. How can you buy solar energy if you never had any currently? If you prefer to pay for solar energy yourself without the government butting in. sure thing, just go out and buy some solar panels!! Prices is coming down while oil prices is going up... Solar energy is what keeps oil prices from going up too much ..You make profits on high oil prices and turn around to find that everything else cost more and your profits disappear! Solar energy is coming down in costs and will keep falling as long as more , more , more of you buy solar energy. This will help keep oil prices at bay! You sure you still want to stay in oil investments?? I dont ..
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  • commented 2 years ago
  • tags: YGE FSLR TSL STP
  • Germany's plan to reduce annual addition of solar capacity until 2020 is still two times as much as America is currently adding here... What this means is that America ought to add 15 gigawatts every year or more at start and then reducing to 8 gigawatts in the latter years. Any of you who argue that solar energy is not economical are paying more to Big Oil because of current shortage. It is actually YOU as a consumer that gave an extra dollar or so to Big OIl every gallon you pumped so that Big Oil can go out and drill for more ... Yet, you refuse to give a red cent extra to solar companies to get an extra watt to our grid.. What is the difference? It is simply because you dont like the idea of our government giving money to companies.. , but really how can you give it yourself since you dont use solar energy yet nor your utilty ... How do you tell me to help solar companies?? Any bright idea??