Germany Runs Out of Solar Panels Due to Generous Feed-In Tariff

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Germany Runs Out of Solar Panels Due to Generous Feed-In Tariff

Written by Susan Kraemer

Published on November 28th, 2009Posted in policy, products, solar energy

A burst of new business at the end of 2009 put Germany close to adding a record of solar power to the grid, according to the head of Germany's BSW solar industry association, Carsten Koernig. He estimates that in this year alone; it will be very close to 3 Gigawatts.

While he is not sure what the final end-of-year number will be, he is sure of one fact. It can't be over 3 gigawatts, simply because there is no more capacity than that in the pipeline.

German supplies have completely sold out. Demand for parts, especially, and equipment such as inverters has outstripped supply. Germany's very consumer-oriented feed-in tariff legislation makes it profitable for any homeowner to install panels on their roofs to supply the grid - - and so they do just that.

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More than 40,000 people work in the photovoltaic industry. The 2008 record solar installed was 1.6 GW, bringing Germany's total to 5.3 GW; one third of the world's 15 GW of solar power. This year's 3 gigawatts could propel it to half the world's solar.

Part of the increase in end-of year sales was was due to pent-up demand as the financial crisis starts to ease in Germany; but part of it was last-minute homeowners and solar investors getting into the action before 2010, when the Feed-in Tariff rates will step down 10%.

Germany's Renewable Energy Sources Act has required power companies to buy all the energy produced by anyone making renewable power, at a fixed above-market price for 20 years.

This payment started out in 2003 as 3 times what the electricity consumer would normally pay for electricity, then went down to 2 times the retail rate. Even after it goes down 10% next year this still amounts to well over what the electricity customer pays.

A surcharge of $1.67 on the monthly bill does not begin to cover that extra cost to the utility; but the nation shares in the Common Good of lowering carbon emissions.