Solar Sector Reluctant to Make Forecasts in View of Feed-In Tariffs Reduction Talks

German solar companies are reluctant to make forecasts for 2010 in view of political talks about cuts of the 2010 feed-in tariffs.

Prices of solar cells and modules decreased substantially in 2009. This made constructing solar installations even more attractive, as the 2009 feed-in tariffs for solar energy remained fixed. In principle, feed-in tariffs only decrease by a pre-determined degression rate pursuant to the Renawable Energy Sources Act at the beginning of each calendar year. In light of political pressure, solar sector representatives already proposed additional cuts of 5% as of mid 2010. It is, however, expected that the actual cuts will be higher.

Due to demand in 2009 that could not always be met, many solar companys still have full order books. Nonetheless, Germany has come under pressure as a production site of solar cells and modules. The example of Q-Cells shows that production in Germany is reduced in favour of new production capacities in Malaysia. According to industry experts this is likely to lead to major industry players like Siemens or General Electric buying solar companies, following the example of Bosch, rather than mergers within the industry. Bosch bought Ersol and Aleo Solar.

Source: Börsenzeitung, 12 January 2010, page 10

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