As recently as last year, Germany was the world-leader in solar energy, claiming 20 percent of the global solar market. But the country’s position has dropped dramatically in recent months to a mere 6 percent as several factors threaten the country’s clean energy future.
Thousands of jobs are on the line in Germany as the cumulative effects of cheap Chinese solar panel imports, heavy subsidy cuts and the worsening euro debt crisis converge.
Germany was among the very first European countries to pursue renewable energy development on a large scale by introducing generous solar Feed-in Tariffs (FiTs). The FiTs were so successful that it prompted the Chinese to develop its own solar PV manufacturing industry, assisted by government subsidies that increased exports.
Now the German federal government and its 16 states are struggling to compromise on solar-power subsidies to preserve the positive solar atmosphere within the country. Recent efforts have stalled in arbitration, but will resume in a couple of weeks to renegotiate.
The United States Commerce Department recently found that Chinese manufacturers received 10 World Trade Organization (WTO) illegal subsidies and illegally dumped solar products on the U.S. market last year. The Commerce Department ruled that imported Chinese solar panels will be subject to a 31 percent charge, retroactive for 90 days.