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13 January 2011

German solar sector fears subsidy cap

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Fearing a painful cap on subsidies at the start of next year, the German solar power industry has approached the German government for discussions on voluntary feed-in tariff reductions taking effect this summer

The industry lobbying group BSW is ready to accept a reduction of subsidies for rooftop installations "by up to 12 percent" as early as July, BSW head Carsten Koernig told Wednesday's Berliner Zeitung newspaper. BSW is a solar industry lobbying group.

This comes after a record 2010, when an estimated 10 gigawatt of solar capacity, the equivalent of 10 large coal-fired power plants, was installed in Germany. In 2009, 4 GW were installed.

While it's unusual that a lobbyist proposes a funding cut, Koernig says he knows that last year's solar power boom has damaged his industry's standing with the government and ordinary Germans.

Because the renewable energy feed-in tariff is paid by German taxpayers via their electricity bills, the 2010 solar module sales record has driven up power prices. The so-called eco-tax jumped from 2 cents to 3.5 cents per kilowatt-hour at the start of this year. As subsidies are guaranteed for 20 years, Germany faces billions of dollars in costs for decades to come.


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