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Germany’s solar industry could implode this summer

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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.

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.


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).


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.


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.


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.


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