Germany’s solar market is in the midst of a transition experts say will be an important turning point in the solar industry’s history.
The country produced more energy from solar power in 2011 than ever before and despite slow-downs in installations and changes to the government incentives, solar is still on the rise in Germany.
The installations are continuing despite a lack of government subsidies.
“We’re just at the starting point of this transition from energy producers to users,” said Tobias Rothacher, Solar photovoltaic spokesman for Germany Trade and Invest, a German analytics and investment firm that promotes investment in the country.
The country, which is home to more than a quarter of the world’s installed solar, has vowed to replace its nuclear power plants with renewable energy sources, particularly solar.
But at the same time, the country has been scaling back on government incentives. It recently reduced its feed-in-tariff. And the amount someone can make on producing solar power has dropped below the retail rate for electricity.
“There is actually a higher return on investment when you use the energy you produce now,” Rothacher said.
That makes Germany’s solar market much more like the market in the United States, he said.
“It’s not so dependent on government subsidies now,” he said.
While, the incentives for large utility-scale solar plants has dropped, he expects interest in distributed rooftop generation to slowly grow, he said.
He lives in multi-family housing and said he’s surprised landlords haven’t realized yet that they can install rooftop solar and sell it to their tenants.
“In Germany, we have legislation that will allow this,” he said.
While the opportunity to make a business out of producing and selling solar power is reduced by recent changes to the way Germany promotes solar, Rothacher said there is still tremendous opportunity in the industry, which has matured to the point where it is continuing to grow – though at a much slower rate – without much government assistance.