s o l ar S U B S I D I E S
BURNED by the sun
Poland is willing to learn lessons from other EU markets, where generous subsidies are now being scaled back to relieve consumers from having to stomach increasing energy bills. B y w o jciech k o sc
The sun keeps shining on Europe. Only the sunshine isn’t bringing revenue, at least in countries like Germany, Spain or Czech Republic. There, ill-advised support systems for energy generated from photovoltaic (PV) installations resulted in PV being the most favored type of renewable energy investment. Before long, PV projects had little to do with countries’ efforts to build sustainable alternatives to the burning of fossil fuels. A wildcat run to get at the generous subsidies resulted instead, with end users paying expensive bills. PRICES UP... “The most important negative aspect of the solar boom is significantly increasing price of electricity for end customers - by 2,4 percent in 2012 - despite the falling prices of electricity on the world markets,” said Tomáš Gebauer from the press office of the Czech ministry of industry and trade. The Czechs’ fundamental error was that the generous feed in tariffs system didn’t establish any limits or controls on the amount of installations or a cap on installed capacity. “Because tariffs were very generous, prices of equipment were falling very fast and financing was easily available, a bubble was created. The 44 | CLeantech |Q2 2013
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The support for all new renewable energy source installations will be terminated from 2014”
year 2011 saw more than 1600 MW of PV installed, the largest per capita capacity worldwide,” said Francisco Queirós, project manager for Martifer Solar in Slovakia and Czech Republic. The over-development of PV created technical problems in grid management and a huge cost of PV subsidies to the state. ... but COSTS DOWN In Germany, according to Macquarie, an investment bank, the situation is similar. The report lists renewable energy subsidies as a key driver for the steady climb in energy prices. However, Macquarie says, the kind of reaction that took place in the Czech Republic - first cutting the subsidies in half in 2011 and now planning to axe them altogether may not work.
“The ever-increasing prices for domestic and commercial customers as well as rapid solar cost declines have brought on the advent of grid parity for German roofs. Thus, solar installations could continue at a torrid pace,” Macquarie reports says. In the Czech Republic they won’t continue, says the ministry’s press officer. “The support for all new renewable energy sources installations will be terminated from 2014.” Still, the country is going to continue to face the legacy of the poorly designed support system. “The Czech Republic will still pay support to existing RES installations for the next 20-30 years,” said Mr. Gebauer. AT HOME In Poland, it seems, the government noticed the problems elsewhere, and has proposed correction coefficients (factors by which green certificates' value is multiplied). These factors vary depending on the type and size of installations. For small and micro installations, FITs will be introduced. For PV, the maximum feed-intariff value is PLN 1,300 (€308) per 1MW and only applies to the smallest installations on rooftops. By comparison, the Czech feed-intariff, applied across the board, exceeded €400 per 1MW before it took the first slash in 2011.Co