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Media disconnect over rumoured FiT changes in Germany
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Reuters has kicked up a storm over a story claiming that cuts to the German FiT could be as high as 17% and brought in as quickly as April. We have been inundated with messages either by sending us that story or asking for confirmation of its authenticity as well as simply asking for our thoughts. I thought it best to address everyone via this blog rather than get back to everyone individually.
Adding fuel to the fire, or as in this case the photon fires, has reached a new eclipse. But as in most speculative moments of madness those that attended the meeting in Berlin to discuss intermediary cuts to Germany’s feed-in tariffs may be forced to reveal in detail what proposals they put forward and what impression they got from government representatives as to what the real cuts to the FiT’s may be.
Importantly those details need to be relayed to the public and the industry at large as soon as possible as I sense that a manipulation of the press is at hand. I don’t doubt that a Reuters journalists somewhere has a good ‘source’ in government. We in the trade press wouldn’t, in most cases.
I get the sense that ‘somebody’ contacted Reuters to create the confusion and concerns that have been echoing around the industry. I am happy to be proved wrong on this but right now there is a disconnect between these rumoured high cuts and actual statements from all sides.
It has also been clear that the industry has demonstrated its ability to create jobs and help the environment, both in the country and the world at large. However, this would seem to have been evaporated in one day, based on reports, primarily from Reuters that new FiT cuts could be as deep as 17% for new roof and open-field sites from April 2010 and clearly above and beyond the legislated annual declines built into the programme.
A possible 17% cut, implemented mid-year or as early as April, as reported is simply way beyond ‘moderation’ and yet that figure being propagated has been released on the basis of ‘government and industrial sources.’
I see a disconnect between what the BSW tried to paint and numerous accounts in the press over the last few months of what the German government wanted to make happen, which led to the talks in Berlin in the first place.
I am not naïve enough to think that any government would not have been playing a game of smoke and mirrors all along, yet I can also believe that a negotiated and balanced approach is what parties are trying to reach, so the 16-17% rumours seem completely out of place.
This was reinforced to me with the reported 3GW effective cap and further penalties should PV installations reach 3.5GW in a given year. All this seems very reasonable, so it highlights in another way that there is something wrong, something a general news journalist would not necessarily grasp and would not necessarily question such a disconnect.
Hopefully, the rumoured cuts do not materialize to the degree being claimed, which would then allow the investigation into the source of these claimed cuts and the motivations for doing so.
The only good point is that we should get action and clarity on the changes to the German FiT very soon.
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The "actual" feed-in degression per Jan. 1 2010 is a split depending on the category involved and results from the market growth data "established" by the Bundesnetzagentur (BNA) on October 19. 2009: Market growth in 12 months time (period: Oct. 1 2008 till Sep. 30 2009) fixed as 2,339.615 MWp, way beyond the highest predicted "market growth corridor" of 1,500 MWp. As a result, because of the conditions formulated in the EEG 2009 Novelle Law text valid as of Jan. 1 2009, the new official degression percentages as of Jan. 1 2010 were established by the BNA as: 9% for all installations up till 100 kWp 11% for all installations larger than 100 kWp (free field included) 9% for the "selbstverbrauch" (self-use) category up till 30 kWp By the way: Asbeck himself had proposed 15% for, if I am right, 2011, as a possible negotiation deal (Photon reported). Don't forget that kWh consumers in Germany already paid 9 billion Euro for all EEG feed-in (wind larger than biomass larger than solar larger than hydro, etc.). Still rising of course. That is a hot issue in German policy (and industry, who pays for the same kWh EEG Umlage...). Alle the tariffs per category per installation year can be found on my website: http://www.polderpv.nl/teruglevering_EEG.htm#tabel_EEG_2009-2010
I am an industry analyst who contacted Solarworld's investor relations officer about this on Friday morning. Their HQ is in the same town has the political HQ of the German FDP party. They confirmed to me that the 16-17% had indeed been proposed by the government in Berlin and that it would be INCREMENTAL to the 10% already implemented from Jan 1st. However they also stressed that this was a negotiating position, nothing was finalised, and that it was inappropriate to jump to conclusions.
I wonder if the reuters reporter is comparing the mid-year 2010 proposed FIT number to the mid year (i.e. all year) 2009 FIT number, without realizing that the FIT already decreased 10% (or whatever the precise number is) Jan 1 2010? That is to say 16-17% is the "total" reduction by April, not the extra reduction in April.