Germany’s solar industry could implode this summer

Once the 52 GW threshold is eached - probably as early as summer - the solar cap will close. This means that smaller plants of up to 750 kilowatts, which make up the majority of newly built plants, will no longer be entitled to subsidies from the Renewable Energy Sources Act (EEG). [Chaiwat Areeraksa | Shutterstock]

Germany’s solar industry is in deep crisis and may implode in the summer. Solutions have been around for a long time, but internal power struggles and debates over distance rules between wind turbines are holding back progress. EURACTIV Germany reports.

The country’s solar industry is collecting signatures and writing incendiary letters to politicians to finally abolish the solar cap and thus save thousands of jobs.

According to the latest survey results of the German Solar Industry Association (BSW), the industry’s business expectation index has halved in just three months, and that’s not even due to the coronavirus.

“We have never seen a comparable slump in such a short time. More and more solar companies are having existential fears,” said Carsten Körnig, BSW’s chief executive officer.

The latest figures from the Federal Network Agency show how thin the air under the solar cap has become.

At present, Germany has solar plants with a capacity of 50.09 gigawatts.

However, once the 52 GW threshold is reached – probably as early as this summer – the cap will close. This means that smaller plants of up to 750 kilowatts, which make up the majority of newly built plants, will then no longer be entitled to subsidies from the Renewable Energy Sources Act (EEG).

Postponed, cancelled and ignored

There are no technical reasons why the solar cap has not been abolished despite all the promises made by the grand coalition since last year. The legislative text has long been drafted and is in the hands of the Bundestag’s energy committee, right next to a draft bill by the Bundesrat, which advocated abolishing the cap in October .

But there is no white smoke rising from the Bundestag building in Berlin just yet because internal resistance is blocking the release of the law to the plenary.

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An eagerly awaited meeting of the federal states’ premiers on 12 March did not lead to an agreement, and the planned working group between the state leaders and the federal government did not even meet because the coronavirus had paralysed public life.

Little else has happened since then.

“With its blockade policy against renewable energies, the government endangers climate protection and investment security in equal measure. This is even more irresponsible for the economy in times of corona-induced uncertainty,” said Julia Verlinden, energy policy spokeswoman for the Greens and member of the economic committee.

On the last two occasions, there were no results either.

Last week, the federal cabinet passed a “mini-amendment” to the EEG to bolster the energy sector against the pandemic, such as longer implementation periods for solar parks, but ignored the topic of solar caps. Even a video conference of the energy ministers on 4 May did not deal with the topic.

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Economic spokesperson remains silent

In an absurd way, the problem is not the solar cap itself, because there is broad consensus that it has to go. According to a poll by YouGov, more than 80% of voters from all parties, except the far-right AfD, are in favour of abolishing the cap.

The debate has for months been hinging on the controversial distance rules between wind turbines and buildings, for which Economy Minister Peter Altmaier (CDU) wanted to set a 1,000-metre minimum distance to reduce the countless civil lawsuits against wind turbines.

While Altmaier has since softened his proposal, this distance debate has long become a power game between the CDU and the SPD. The economic policy wing of the conservative Union of CDU/CSU is insisting the solar cap should only be adopted together with the coal phase-out law and a solution for wind energy, thereby blocking any rapid progress.

The Union’s economic policy spokesman, Joachim Pfeiffer (CDU), was not available to speak on the subject despite repeated requests.

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Fear of ‘super climate policy disaster’

Germany is losing valuable time as its political parties quarrel over distance rules, which are urgently needed to expand renewable energies. There is neither a clear path for the expansion of renewable energies, nor connectivity solutions for wind farms that will soon fall out of the 20-year support period of the EEG. The necessary power lines are lacking anyway.

Still, even without the dispute, Germany would be long behind schedule.

If a 65% share of renewable energies in the electricity mix is actually to be achieved by 2030, Fraunhofer ISE calculates that 5-10 GW of solar plants would have to be built annually. In its climate protection programme of October, the German government had set an average of 4.5 GW as a target. However, the solar plants installed last year would not quite reach 4 GW.

BSW boss Carsten Körnig is urging politicians to abolish the solar cap before the end of May, as he is threatening that otherwise there would be a “super climate policy disaster.”

[Edited by Zoran Radosavljevic]

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