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Market News

 January 10, 2012
Germany reports record 60 per cent surge in solar generation

 Germany saw solar output rise a record 60 per cent last year to more than 18 billion kilowatt hours of electricity, according to new figures from the German Solar Industry Association (BSW-Solar).

The trade body said the output was equivalent to the entire electricity consumption of the state of Thuringia and could theoretically provide clean power to 5.1 million households for an entire year.

"Solar power has become an indispensable ingredient for the success of the energy transformation," said Carsten Körnig, chief executive of BSW-Solar in a statement, adding that the surge in demand has been driven by rising oil and gas prices and the falling cost of solar technology.

The rapid roll out of new solar installations continued despite moves by the government to cut the level of incentives available through the country's flagship feed-in tariff scheme during the year. Additional cuts of 15 per cent also came into effect as of 1 January in response to the continued reductions in the cost of solar panels.

Solar panel prices in Germany have fallen by about 50 per cent since 2007 and Körnig said the industry was standing by its commitment to reduce the cost of solar power to a level where incentives will eventually be phased out.

"As a next step, in 2013/2014 we will be able to match the support level of large ocean-based wind farms in initial market segments," he said. "This is the result of major efforts on the part of industry and research, combined with the effects of tough competition in international markets."

BSW-Solar said the country's solar sector has also prospered as a result of an increasingly stable policy environment that has seen the government set out a timeline for reducing incentives 15 per cent at the start of this year and a further nine per cent in the middle of the year.

Körnig urged the government not to tamper with this timeline and allow firms to benefit from "reliable political conditions".

"This is indispensable for the continued expansion of renewable energy sources and for maintaining an attractive climate of investment in Germany," he said. "It's the only way to ensure that the contract between generations contained in the energy transformation will work. And it's the only way that Germany can continue to be successful in the now highly competitive growth markets."