Later but Slightly Higher Cuts of Solar Feed-In Tariffs?

Cuts of the solar feed-in tariffs will come a bit later, but will be a bit higher than proposed previously, Hans-Peter Friedrich, head of the group of members of the Christian Social Union (CSU) in the German Parliament (Bundestag) said after a meeting of the ruling coalition partners CDU, CSU and FDP on Tuesday.

The coalition partners reportedly agreed to cut feed-in tariffs for roof-top installations by 16% as of June. Environment Minister Norbert Röttgen had recently suggested to cut the feed-in tariff for this type of installation by 15% starting in April. The postponement of the cuts should help investors who had already planned installations for some time, Friedrich explained.

Feed-in tariffs for new freestanding facilities shall be reduced by 15% as of 1 July 2010 as proposed by Minister Röttgen. It is not yet clear what cuts shall apply for installations on agricultural land. The CSU does not want to subsidize this type of installation at all.

A final decision about solar feed-in tariffs by the Federal Cabinet shall be made this month. The CDU and FDP parties shall then present a draft bill to amend the Renewable Energy Act (EEG) to the Bundestag.

The installation of solar systems is eventually paid for by the consumer. Feed-in tariffs, which are paid to the renewable energy producer are passed on to the consumer by the grid operator. The high feed-in tariffs for solar energy led to a boom in solar system installations, while increasing electricity costs for consumers. Hence, the ruling CDU, CSU and FDP parties had agreed to revise solar feed-in tariffs in their coalition agreement. However, cuts will now be higher than originally expected. This led to a slump of solar stocks in Europe, the United States and Asia, since Germany is the most important market for the industry.

Source: Reuters

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