Germany approves reduced solar feed-in tariffs

Germany's upper house of parliament (Bundesrat) on Friday approved revised feed-in tariffs (FIT) for photovoltaics, according to German Energy Blog. Lower house (Bundestag) approved the cuts on Thursday.

The reductions will be between 20 and 30 percent, depending on the size of the solar energy system. The tariffs for photovoltaics shall apply retroactively as of 1 April 2012. They will decline in small steps each month, instead of large annual or semi-annual steps in the past.

Solar panels at a solar park in Freiberg, Germany. © Joachim Eckel

The government will retain the 2.5 MW to 3.5 MW annual “growth corridor,” without reducing funding. Under the original plan, this funding was set to be drastically reduced, according to financial firm Jefferies, writes Solar Industry.

Systems smaller than 10 kW will receive 19.5 cents/kWh, projects between 10 kW and 40 kW will receive 18.5 (euro)cents/kWh, systems between 40 kW and 1 MW will receive 16.5 cents/kWh, and 0projects between 1 MW and 10 MW will receive 13.5 cents/kWh. Solar projects larger than 10 MW will not receive a FIT.

The feed-in tariffs that utilities pay to 1.1 million solar power producers helped make Germany the world's largest market for photovoltaic power generation with a third of the world's installed capacity, writes Reuters.

Germany currently has about 28 gigawatts (GW) of installed photovoltaic capacity. The new law also will cap incentives when total capacity reaches 52 GW, in about three to five years when the FIT will most likely have fallen to levels that make solar power as inexpensive as some conventional fossil fuels.

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