Renewable energy consumers in Germany are celebrating after the government said it would scale back the feed-in tariff by only 9-10 per cent each year until 2011.
The news is a huge boost for renewables in Germany, as it was expected that a 30 per cent scale back would be implemented.
In 1999, the extra costs to consumers were €19 million; in 2005, €506 million; and in 2008, the cost is expected to €1 billion. The costs could grow even higher in the coming decade because households with solar panels are guaranteed a fixed income for 20 years for surplus electricity sold to the national grid.
Solar power in Germany is set to generate 4.134 gigawatt-hours (GWh) or 0.83 percent of the country’s total electricity consumption in 2008; wind power generates 41.143 GWh or 8.26 percent of the country’s electricity.
Employing around 60,000 people, mainly in eastern Germany, the country’s solar industry is set to have a turnover of around €7 billion in 2008.
Though PV electricity will continue to cost between €0.40 to 0.50 per KW/h even after the feed-in tariffs are lowered, experts from the German solar industry association, Bundesverband Solarwirtschaft (BSW), predict that the cost will fall to grid parity sometime in the next decade.
The German solar industry will invest €175 million in solar cell research in 2008; a number that will rise to about €225 million in 2010, according to the BSW August 2008 statistical figures of the German solar PV branch.
Although Germany is still the third largest producer of solar cells in the world after China and Japan, with a 20 percent market share, recent studies predict that Germany’s share of the world’s newly installed capacity will fall to 28 percent in 2010, from 58 percent in 2006.