The German government could impose harsher-than-expected cuts to solar energy subsidies next year due to a rise in solar panel installations, according to a Reuters report.
In June and July, around 1.25GW of PV capacity was installed in Germany – higher than the figure achieved in the preceding five months of the year combined. And while Germany's network regulator declined to comment on these reported figures, government sources have indicated this will prompt a 15% cut to incentives in January – 6% more than planned but still well below the maximum allowed cut of 24%.
After controversially imposing severe subsidy cuts last year, Germany revamped its scheme to allow for regular reviews and reductions to help respond to falling solar panel prices; in June the government backtracked on plans to introduce a mid-year cut because of disappointing installation figures of 700MW in the first half of the year.
However, the feel-good factor from this decision has lasted barely two months and, should reports of this latest cut prove correct, this latest news will spark concerns that other European countries may follow suit and further destabilise the industry.
Solar panel prices have dropped dramatically over the past six months after cuts to incentives across Europe curbed demand, which has left many manufacturers incurring major losses and some battling to even stay afloat.