Solar Industry Voices Strong Criticism for Planned Reduction of Funding

German’s solar companies are worried about their competitiveness and technological leadership. The German Solar Industry Association (BSW-Solar) is urgently warning of a wave of insolvencies in the sunrise industry of photovoltaics and the loss of tens of thousands of jobs if the drastic cuts in the feed-in tariff are implemented in the next few weeks as presented today by Federal Environment Minister Dr Norbert Röttgen. An amendment to the minister’s plan is essential. In the unanimous view of 800 solar companies and leading solar researchers organised under BSW-Solar, the current suggestion for cuts from the Federal Environment Ministry is utterly excessive and requires urgent improvement. It includes a one-off reduction of 15 - 25 percent points by the summer of 2010. Furthermore, at the start of the following year, the annual reduction of nine percent that is already grounded in the Renewable Energy Sources Act is to be made in addition to a solar feed-in tariff reduction that is up to ten percent quicker.

BSW-Solar Managing Director Carsten Körnig: "Depending on growth and market segment, this brings the total reduction in funding for solar energy from 31.12.2009 to 01.01.2011 to 25.5 - 55 percent points. Such a radical and sudden incision robs German solar companies of the foundations of their business. They are left with no scope for investment in order to survive in the harsh international competition." According to an assessment by industry experts, as a result of intensive efforts by the solar industry to reduce costs and as a result of harsh competition, solar energy will be able to compete with conventional consumer energy rates as soon as in the next three to four years. This will allow a gradual and growth-dependent reduction of the solar feed-in tariff by between nine and 14 percent per year, as already suggested by the industry at the end of last year. This would ensure that the economic efficiency of operating solar arrays in all market segments is maintained - whether on the roof or in open spaces.

"If the additional reduction plans in double-digit percentages were to become law, the Chancellor’s climate policy would be rendered obsolete. Dozens of German solar companies would then face insolvency or be forced to relocate their production outside of Germany," warns Günther Cramer, President of the German federal association of the solar industry. He is urgently appealing to German Chancellor Dr Angela Merkel to correct the current suggestion of a drastic reduction in the feed-in tarrif. Once competitiveness is achieved, large growth markets will be open to the German solar industry both at home and abroad.

"The excessive feed-in tariff cut endangers one of the most important driving forces of jobs and the economy in our country. The creation of value added in the production of PV modules must be allowed to continue in Germany," Cramer says. In recent years, the solar funding in the Renewable Energy Sources Act has allowed rapid expansion of the solar industry in Germany. Last year, the solar energy sector achieved a turnover of around ten billion Euro and it now has around 60,000 employees in trade and industry. Germany is a world leader in the field of solar energy. In addition to the high level of innovation potential from over 60 research facilities and the strong machine and plant construction, the attractive statutory funding conditions for solar energy under the renewable energies act are essential market openers.