The Bundesnetzagentur, Germany's Federal Network Agency, will cut the country's solar feed-in tariff (FiT) by 15% in 2012. The subsidy reduction is more severe than the 12% forecasted by many industry insiders and was triggered by the 5.2GW of new capacity installed between October 2010 and September 2011.
Under the German Government's Renewables Act, the FiT adheres to a degression regime, where cuts are dependent on the previous year's installation figure. Although the figure is well below the 7.8GW installed the previous year, the collapse is not as dramatic as had been expected when the German Government initially announced its FiT cut. Indeed, between July and September 1.6GW was installed, just 100MW shy of the corresponding year-on-year number.
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The following rates are applicable for the coming year:
| Installation type | Size | Rate |
| Rooftop | ≤30kW | €0.2443 per kWh |
| Rooftop | ≤100kW | €0.2323 per kWh |
| Rooftop | ≤100kW | €0.2198 per kWh |
| Rooftop | ≤1MW | €0.1833 per kWh |
| Ground-mounted | all | €0.1794 per kWh |
However, the Bundesnetzagentur's announcement may also spark a rush of installations between now and the year's end, as developers seek to lock in higher tariffs before the new rates come into force on January 1, 2012. Should this scenario transpire, this new capacity will result in a further subsidy reduction in July 2012.
