GERMANS, FRENCH ADJUST FEED-IN TARIFFS

Germany plans solar subsidy cuts from April-sources; Tariffs on new roof sites to be cut 16-17 pct-sources
Markus Wacket (w/Christoph Steitz, Laura Isensee, Matt Daily, Madeline Chambers and Steve Orlofsky), January 14, 2010 (Reuters)
and
France Modifies Feed-In-Tariff Rates
14 January 2010 (Solar Industry)

"The German government plans to slash solar power incentives much more deeply and sooner than expected…raising fears that growth would slow in world's largest consumer of the renewable power source…[T]he government [reportedly plans] a one-off cut in feed-in tariffs for new roof and open-field sites from April by between 16 percent and 17 percent in addition to the annual decline… in the country's Renewable Energy Act (EEG).

"The news sent U.S.-listed shares in solar companies down between 3 percent and 10 percent because market analysts have anticipated a lower cut of 5 percent to 10 percent, and not until July 1…The global solar power industry has struggled over the past 15 months to secure funds for new projects as the financial crisis choked off investment…Germany's lucrative incentives had kept the country at the forefront of the industry…A spokeswoman for the environment ministry said no decisions [will be made until next week]…"

The F-I-T that changed the solar industry. (click to enlarge)

"Under the feed-in tariff, utilities are obliged to pay 39 euro cents per kilowatt hour of electricity produced for 20 years for systems installed in 2010, which is down from 43 cents for systems installed in 2009…[It falls] about 8 percent per year before dropping 10 percent in 2010…[The unannounced] plans also envisage an additional one-off cut of 2.5 percent in 2011, should the installation volume in 2010 exceed 3 gigawatts, and even more if it totals more than 3.5 gigawatts. Bigger subsidy cuts are planned for solar equipment on farm land…The European Solar Industry Association EPIA estimates that 2010 installation could rise to 2.8 GW…

"Since Germany's new coalition government was elected in September, the solar power industry has widely expected cuts…Estimates of how and when those cuts to the feed-in tariff will take place have varied widely…Companies across the sector will be affected by cuts in solar aid, whether they are heavily exposed to Germany or not…In 2008, a cut in supports by the Spanish government erased about two-thirds of the demand for solar power systems there, creating a glut of supplies that eroded global prices for solar modules…That, combined with the global credit crisis and fast-rising solar module manufacturing capacity, have contributed to a decline in the cost of the panels that some analysts have estimated at about 50 percent over the past year…"

The original degression rate, about to be revised. (click to enlarge)

"France's Energy Ministry has announced a revised feed-in-tariff structure…Under the new rules, certain building-integrated photovoltaics (BIPV) installations that integrate components in a visually appealing manner will receive a rate of 0.58 euros/kWh, which is the highest in the world…[A]t industrial, commercial and agricultural sites [the tariff for these types of installations] will be 0.50 euros/kWh.

"Simpler, non-fully-integrated BIPV installations will receive 0.42 euros/kWh…Ground-mounted photovoltaic installations will generally receive a tariff of 0.314 euros/kWh, although projects with capacities over 250 kW in areas with lower solar resources may receive up to 0.377 euros/kWh. The Energy Ministry says this stipulation will allow for improved geographical distribution of solar projects countrywide."