Germany's solar feedin' frenzy

Consumers in the world's largest photovoltaic market are rushing to buy solar panels before subsidies decline in January.
Written by Mark Halper, Contributor

Consumers in Germany - the world’s largest photovoltaic market - are rushing to buy solar panels before subsidies in the form of feed-in-tariff decline in January, according to a California research firm.

“After slumping in July and August, Germany’s orders for new photovoltaic (PV) solar systems are set to soar in October and November, generating a surge in demand that may be difficult for major suppliers to accommodate,” El Segundo-based IHS iSuppli said in a press release.

“The boom in orders in Germany, the world’s largest PV installation market, is being driven by the looming drop in the country’s feed-in-tariff (FIT) in January of next year. The FIT acts as a major incentive for PV installations. Investors and homeowners are rushing to place orders for solar systems before this incentive decreases.”

Although the spike had been anticipated since July, consumers delayed purchases as they went on vacation and as they waited for the tumbling price of solar panels to reach even lower levels, iSuppli states.

Chinese manufacturers that supply many of Germany’s solar panels will have difficulty meeting the rush of new orders, opening up opportunities for “first- and second-tier module manufacturers closely linked to wholesalers in Germany,” said iSuppli.

Germany remains the world’ largest generator of solar electricity. It rose to prominence largely on the strength of feed-in-tariffs, which pay consumers for electricity they generate with solar panels. Germany was an early adopter of FITs, having started them over a decade ago to help kick start the industry and encourage renewable electricity. The country has been lowering the FIT rate as the industry matures.

German PV installation will decline 20.4 percent in 2011 to 5.9 gigawatts down from 7.4 GW in 2010, iSuppli forecast.

“Despite the shrinking PV markets in Germany and other European countries, global PV installations will rise 21.7 percent in 2011 and 13.7 percent in 2012,” the research firm predicted.

Image: 46137/Flickr

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This post was originally published on Smartplanet.com

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