Germany has announced revised, lower feed-in tariffs for solar PV that take effect in 2012.
Since the 15% drop in payments for electricity produced from solar plants was widely expected and the industry had plenty of time to adjust, it's taking it in stride.
The tariffs still maintain Germany's lead as the fastest developing market for solar PV and bring German solar PV within striking distance of "grid parity" - competitively priced with fossil fuels. Small solar rooftop systems will get paid 24.43 cents per kilowatt hour, down from 28.74 cents, about the price of utility bills.
"The solar industry fulfilled its promise to produce more and cheaper electricity, says Carsten Koernig, chief executive of the Federal Association of Solar Industry Association (BSW-Solar). By 2012 solar power will come from your own roof at the same price as household electricity prices. By 2014, large solar farms will produce electricity at prices as favorable as wind power at sea."
In 2012, tariffs for solar PV plants built on brownfield sites will be about the same as those for offshore wind (€0.15/kWh; $0.20/kWh) which includes a bonus if projects are finished by 2018, bringing the total to €0.19/kWh ($0.26 USD/kWh).
Germany requires the tariff be reduced 9% a year, depending on the amount of solar installed. Tariffs have fallen over 57% since 2004, effectivey driving world solar PV prices toward grid parity.
Over the past year, an astounding 5200 MW of solar has been registered (130,000 systems) indicating the industry has reached levels of scale where it no longer needs such high subsidies. The rate could have been cut by as much as 24% if more solar had been added.
Solar PV in Germany tripled from 2009-2011, and supplied 3.5% of the country's electricity in the first half of 2011. That share is expected to rise to at least 10% by 2020.
And wind, solar, biomass and hydro combined supplied a record 20.8% of Germany's electricity in the first half of 2011. And it's reducing the price of electricity overall.
The country's latest version of its feed-in law now extends to onshore and offshore wind, geothermal, and biomass - to help it quickly diversify into the full range of renewable resources.