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Germany Reconsidering their Awesome Solar Subsidy Program

Avatar for Dave Llorens
Published on 05/17/2008 in
Updated 05/17/2008
Germany is Cloudy

With respect to how much sun they get, Germany has taken their lemons and made lemonade.

The Renewable Energy Sources Act of Germany forces power companies to buy all the alternative energy created by citizens, at a price greater than market prices, and for a long time (20 years). That massively compelling subsidy has turned Germany into the world leader on solar (and keep in mind, they only get half the sun San Diego does!).

As a salesperson for solar energy here in San Francisco, customers with glorious giant flat roofs will often install the smallest possible system because they have low energy usage. PG&E, the utility company here, does not pay you cash if you produce more than you consume for the year. They will credit towards your next months bill, but no wampum in your hand if you go over.

The only way to incentivize someone to install more solar than they need is to pay them for the excess electricity they generate, which is the only way to create a healthy and clean distributed generation network. That is what Germany does, and it kicks butt. The rub comes from the fact that the money for this subsidy is paid for by the consumers that don’t have solar. Right now they are just paying a Euro more than normal, but that could spike to more, alienating consumers.

The proposal by conservatives is to increase the rate at which the subsidy declines, and possibly lower the term from 20 to 15 years. It is unclear to me exactly whether it only effects new installations, or is horribly nasty and effects people that have already installed (which I doubt). Either way, a deal’s a deal as I see it.

Spain has a similar subsidy, and a hell of a lot more sun, so Germany is concerned they will overtake the lead in the market.

The moral of the story is simply that if you make something compelling financially to people, they act in droves. We need to do that here.

I am good at my job. That being said, even with the most progressive culture in the US, a lot of recent legal lubrication for coding/permits, the best subsidies in the nation, and a ton of sun, my job is hard hard hard hard hard.

I got this info from the NY times: Here is the original article.

Last modified: May 17, 2008

One thought on “Germany Reconsidering their Awesome Solar Subsidy Program

  1. Avatar for Snooj Snooj says:

    Once CaISO goes two settlement won’t one be able to simply be a RT price taker on excess generation on their solar systems? If not – can’t they offer in the excess generation off their solar system in the DSM program? Both of these would eliminate the need to have any dependence on the local utility…

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