We are pleased to present to you our first in a series of interviews and discussions in relation to the imminent Feed In Tarriff cuts in Germay.

 To start off proceedings we spoke with Prof. Eicke Weber, Director of the Fraunhofer ISE about a study Determination of the extend of a further reduction in the feed-in tariff for solar electricity in 2010 his institute conducted on the effects and implications of the new proposed FIT cuts.

We asked Prof. Eicke Weber the following quesions....

• What are the main findings of your study on the proposed FIT cuts in Germany
  
• Do you think that the Government looked at your report and is is feasible that they will implement any of your fingings? 
  

The Executive Summary can be found towards the end of this page and on their website http://www.ise.fraunhofer.de

More about Fraunhofer ISE

Below are the key findings from a Study from Fraunhofer ISE on behalf of the interest group of the german solar energy industry BSW Solar: 

At present an additional reduction in the feed-in tariff for solar electricity for spring / summer 2010 is being discussed. This study investigates to what extent an additional reduction would be appropriate.

In this study it is shown that:

1. In 2009, the prices for PV systems up to 100 kWp sunk by 25.6%, whereas the feed-in remuneration was reduced by only 9% to 11% in January 2010. Therefore, an additional one-time reduction in 2010 is possible.
2. The large price reduction evidenced in 2009 compensates, in part, for the price stagnation and price increase in 2005 and 2006 and the smaller price reductions in 2008. When considering the price development, therefore, observations should be based on the long-term.
3. Prognos AG recommended that the feed-in remuneration for PV systems be reduced by 16% to 17%. The yield calculations from Prognos AG, however, exhibit electricity production costs and system costs that are both too low.
4. The calculations carried out in this study show that a one-time additional reduction of 6% for PV systems up to 30 kWp and 10% for PV systems up to 100 kWp respectively would be appropriate.
5. A further market growth is to be expected even if the feed-in remuneration is reduced further. It is expected that due to the present worldwide overcapacity, the Asian manufacturers will reduce their prices, irrespective of the real production costs. This price reduction is intended to make investments further attractive and stimulate the demand.
6. There is a high probability that the PV production in Germany would decrease as a result of a larger reduction in the feed-in tariff, because the production would no longer be economically attractive, despite the increase in efficiency. As a result, it is highly probable that jobs would be lost in Germany.
7. A commensurate reduction of the feed-in tariff, which is oriented on the real cost reduction is a necessary, but not sufficient, prerequisite for maintaining the PV production in Germany. The German manufacturers are only able to compete with the Asian PV manufacturers if they hold the technological lead. This requires a definite expansion in the research and development efforts in Germany and an increase in the research funding.

The full study is only available in German.