Solar-subsidies cut in Germany may come three months earlier

Germany, Europe’s biggest renewable energy market, may make its next cut to solar subsidies earlier than planned and reduce them more frequently while averting a fixed limit on installations, a lawmaker said.

German Environment Minister Norbert Roettgen and Economy Minister Philipp Roesler are mulling plans for a lower subsidy for new solar plants that could take effect as early as April 1, Klaus Breil, a lawmaker with Roesler’s Free Democratic Party, the junior coalition partner in government, said by phone today. The next reduction was scheduled for July 1.

Breil said he didn’t know how steep a cut is on the negotiating table, “but my wish is between 25 percent and 35 percent as we need to contain what has become a financial investment vehicle.” He is the party’s energy policy spokesman and was interviewed today by phone. “I don’t think a hard installation cap will be introduced as there was no majority for that in the coalition’s working group.”

Talks being held between Roettgen and Roesler center on adjusting solar subsidies after Germany installed a record 7.5 gigawatts of panels last year, more than double the government’s target and equal in capacity to more than six nuclear plants.

Roesler has previously called for limiting solar installations to about 1 gigawatt per year. Roettgen, whose ministry is responsible for the subsidy law, is seeking to increase the frequency of subsidy cuts but has in the past opposed a fixed limit.

“Talks are on-going and are proceeding well,” Ann- Christin Wiegemann, a spokeswoman for the economy ministry, said by phone today. She declined to comment further on the talks. A call to the environment ministry wasn’t immediately returned.

An installation cap or a more severe one-time cut may threaten German solar companies such as Q-Cells SE and Conergy AG, which are already struggling with rising competition from China where the world’s three largest panel makers are based.

A total of 50 companies including Solarworld AG and SMA Solar Technology AG will protest tomorrow against what the industry fears will be “drastic” cuts to solar subsidies, an industry group said.

Company employees will symbolically lay down work in several German cities amid fears that the government caps yearly installations to a “fraction” of the level seen in the past year, the BSW solar lobby said today in an e-mailed statement.

Chancellor Angela Merkel’s cabinet of ministers may decide on the subsidies as early as Feb. 29, BSW said.