The German Solar Industry Association (BSW-Solar, Berlin, Germany) reports that the nation's solar industry registered an unusually strong PV demand at the end of 2011, significantly contributing to the energy turnaround.

According to PV industry figures, after a weak first half of 2011 PV investment increased significantly. BSW-Solar predicts that overall, new installed PV capacity in 2011 reached approximately 2010 levels.

German PV FIT to be reduced in two steps

BSW-Solar notes that the steep growth path in recent years has now slowed. In 2010 a total of approximately 250,000 PV systems with a capacity of about 7 GW had been installed, with roughly the same in 2011.

The 2012 solar PV feed-in tariff (FiT) will be significantly reduced in two steps. The FiT for solar electricity fell by 15 percent on January1st, 2012 and is expected to decrease by another 15 percent in July 2012. Thus the FiT reduction in 2012 will be twice as strong compared to the 2011 cuts.

Solar PV reaches price level of private electricity tariffs

With FiT rates between EUR 0.18 and EUR 0.24/kWh (USD to 0.23 to 0.31/kWh) for new PV systems, FiT rates have reached the price of household electricity tariffs in Germany. As of July 1st, 2012 they are expected to drop to between EUR 0.15 and EUR 0.21/kWh (USD 0.19 to 0.27/kWh). At the same time costs for the further expansion of solar power have decreased significantly.

"New PV systems henceforth will only have minor influence on the consumer's contribution for renewable energy," says BSW-Solar Managing Director Carsten Koernig.

BSW-Solar this year expects 4% of solar electricity in the German grid

With the growth of PV its share of German electricity consumption in 2012 will increase to over four percent. The solar industry association expects ten percent by 2020, based on an ongoing moderate development.

Thus solar power proves an essential driver of the energy transition, which has to be accelerated due to the abolition of nuclear power plants. The strong PV growth in 2011 was possible without major investments in grid infrastructure, since solar power is being produced on a distributed basis.

The industry association estimates that several effects contributed to the unexpected strong year-end rally: Significantly lower prices for PV modules and turnkey systems, mild weather in December, the announced FiT cut of 15 percent, and political discussions that fueled fears of a cap on solar funding. In addition, the Euro crisis may also have affected the development of solar power, motivating investments in real values.

2011 Revenues and margins below the expectations of many solar companies

In the context of global over-capacities, the German PV industry remains in a challenging situation, with severe international competition and ongoing FiT cuts. Despite a stable or growing demand in Germany and some foreign PV markets, revenues and margins in 2011 fell short of many companies' expectations.

The German PV industry expects advances through increasing foreign markets in the coming years. For Germany, it expects a decline in demand due to the already fixed FiT cuts amounting to around 30 percent.

2012-01-09| Courtesy: German Solar Industry Association (BSW-Solar) | solarserver.com © Heindl Server GmbH

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