PVSEC: German Solar Demand on Record Pace in 2010; Feed-in Tariffs Updated

By Germany Trade And Invest, PRNE
Thursday, September 2, 2010

BERLIN and VALENCIA, Spain, September 3, 2010 - Photovoltaic system installations in the first half of 2010,
estimated at 3 GWp, continue to consolidate Germany's position as the world's
largest photovoltaic (PV) market and an attractive investment location for PV
companies. In 2009, Germany accounted for approximately one of every two
newly installed modules worldwide, with total installations at 3.8 GWp for
the year. Germany Trade & Invest will have representatives at this year's
European Photovoltaic Solar Energy Conference & Exhibition in Valencia,
Spain
, from September 6-9 to introduce opportunities for PV companies in
Germany.

Amendments to the photovoltaic feed-in tariffs of Germany's
Renewable Energies Act (EEG) were passed in early July, with a further
adjustment to take effect October 1. The changes mark a further shift towards
the rooftop segment by abandoning field installations on cropland and
increasing the attractiveness of the own consumption bonus for small and
medium-scale rooftop installations. This bonus is paid to rooftop
installation owners of systems smaller than 500 kWp who intend to use the
energy they generate.

Feed-in tariff rates were reduced by 13 percent for rooftop
installations and eliminated for cropland field installations from July 1. At
the same time, conversion areas saw a reduction of 8 percent and all other
areas were decreased by 12 percent. Beginning October 1, these rates will be
reduced by a further 3 percent. Still, the new tariffs remain highly
attractive, with rates ranging from 25.02 - 34.05 EURc/kWh for installations
connected before October 1 and 24.26 - 33.03 EURc/kWh for those connected
during the remainder of the year.

The law, established ten years ago, requires power companies
to buy renewable energy from system owners at the corresponding feed-in
tariff rate for 20 years, guaranteeing an attractive payback time and high
returns.

Increased Demand by Private Users

The two-tiered changes to the EEG are a reaction to the
increased price competitiveness of photovoltaic systems, including the recent
price drop for solar panels and components. These developments have created a
number of new market opportunities for PV companies. Increased demand in the
rooftop segment corresponds with installations by private users who
overwhelmingly prefer high-quality systems. Changes are also leading to
growing demand for energy storage systems and smart grid applications to
fully profit from the own consumption bonus. By 2013 energy from PV sources
is expected to be competitive with conventional energy sources in the
electricity market for private consumers.

Manufacturers in Germany not only have easy access to a large
and growing market, they also benefit from a competitive advantage through a
local brand presence and reputation for high quality products. Germany boasts
a well established industrial infrastructure, large equipment supplier base,
and qualified and experienced workforce. The country's PV industry also
features the highest density of R&D institutes in the industry.

Germany Trade & Invest will have representatives at this
year's 25th European Photovoltaic Solar Energy Conference & Exhibition in
Feria Valencia - Level 2 - Hall 2 - Booth A17 to meet with companies
interested in the world's photovoltaic leader.

Germany Trade & Invest is the foreign trade and inward
investment promotion agency of the Federal Republic of Germany. The
organization advises foreign companies looking to expand their business
activities in the German market. It provides information on foreign trade to
German companies that seek to enter foreign markets.

    Germany Trade & Invest

    Eva Henkel
    Email: eva.henkel@gtai.com
    T: +49(0)30-200099-173
    F: +49(0)30-200099-111

Germany Trade & Invest: Eva Henkel, Email: eva.henkel at gtai.com, T: +49(0)30-200099-173, F: +49(0)30-200099-111

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