The State of Solar Power in Europe

February 16th, 2012 by Guest Contributor

This is a top-notch guest post by James Hawkins of the UK on the state of solar power in Europe today. It’s got the latest on the solar subsidy story in the UK, as well as many interesting facts and figures on solar in other European countries. Thank you, James!

by James Hawkins

Europe contains nine of the largest 15 solar markets in the world. In 2011, new European PV installations amounted to 20.9 GW, over 75% of the global total (27.7 GW). Germany has long held the crown within Europe as the clear leader in installed solar power capacity and now has a total of 24.7 GW of capacity installed, generating approximately 3% of its electricity.

Why has Germany been such a long way in front? The Renewable Energy Act introduced in 2000 was one of the first of its kind in the world. It introduced guaranteed feed-in tariffs, lasting for 20 years at a fixed price. The rates decrease gradually for new installations, exerting downward pressure on manufacturers to drive innovation. The stability of the scheme, and it’s popularity, has lead to great confidence in solar as an investment option; solar panels are a common sight on a German roof. For this reason, Germany has seen exponential growth in solar installations:

However, Germany is not alone in this rapid year-on-year growth. Italy is the world’s second largest installer, and is closing the gap on Germany. A study by GSE showed Italian installations tripling in capacity from 2009 to 2010 (from about 1 GW to over 3 GW) and then almost tripling again in 2011 after an additional 9 GW of solar were installed (the world-leading amount in 2011).

This surge is due to changes made to the solar power subsidies in Italy in 2010 – there was a feed-in tariff introduced, in addition to a generous grants system. Italy has some of the most favorable weather conditions in Europe for solar, and so it seems logical that it has the most beneficial grants structure.

Solar in the UK — a Roller Coaster Ride

Unfortunately, not every country can keep up with these prime examples; the UK solar industry has recently been in outrage. After introducing a feed-in tariff in April 2010, the number of installations rocketed. However, as installed panel prices fell by 30% from 2010 to 2011, due to a dramatic increase in competition that accompanied the increasing demand for residential solar, the popularity of the scheme was underestimated. Whilst the rate of adoption was impressive, the Department of Energy and Climate Change (DECC) panicked due to the cost of the scheme. The DECC subsequently tried to cut the feed-in tariff rates without holding a complete official consultation, which resulted in an extended court case from several large solar companies. The government’s decision to cut the rate by more than 50% was ruled as illegal. This led to the following:

The scheme was remarkably popular throughout the year, with the boom caused by the announcement that installations from the 3^rd of December would receive a much lower rate – $0.33/kWh rather than $0.68c/kWh. Although the figures are not yet released, following the court decision to reinstate the tariff at the higher level, our (nation-wide) company’s data show installations are likely at a near all-time high. The tariff will fall in March, and so there will be another slump at that point. This instability is very bad for the industry – it puts off investors in solar power, and it has led to thousands of job losses.

Solar in Other Parts of Europe

Solar also hasn’t yet had much of an impact in Eastern Europe. Latvia, Estonia, and Lithuania each have under 0.1 MW of installed solar power capacity, and none of them have any government funding specifically for solar panels. Hopefully, the success of solar seen in other countries may be replicated. For example, Lithuania opened its first solar panel production site last year, primarily targeting surrounding countries.

Parts of Europe have struggled economically in 2011, of course, especially from the Greek financial crisis, but hopefully priorities will switch to longer term tasks soon, such as developing renewable energy from 2012.

Currently under construction in the Sahara, the Desertec project will be the world’s largest solar power farm (or collection of farms), and parts of it will be producing electricity for use in Europe by as soon as 2015. The aim is to meet between 15 and 20% of Europe’s energy demand by 2050, meaning German levels of solar power across every member state!

Whilst this will all provide a boost to Europe’s renewable energy use, it’s worth noting that other countries are working hard to close the gap – the USA is seeing record levels of solar installations, China is also engaged in a big solar power push, as are India and Japan. The consensus is that the German model is the most sustainable solution to replicate, and we’ll likely see feed-in tariff schemes adopted in most economically developed countries in the months and years to come, both within Europe and worldwide.

Written by James Hawkins, creator of a solar panels cost comparison service in the UK, where he also writes the solar blog.

Keep up to date with all the hottest cleantech news by subscribing to our (free) cleantech newsletter, or keep an eye on sector-specific news by getting our (also free) solar energy newsletter, electric vehicle newsletter, or wind energy newsletter.

Tags: Europe, Europe solar, Germany, germany solar energy, Italy, italy solar, solar energy europe, UK, uk solar energy, uk solar FiT, uk solar subsidies, uk solar subsidies cut

About the Author

Guest Contributor is many, many people. We publish a number of guest posts from experts in a large variety of fields. This is our contributor account for those special people. :D

Fogood

As pv module company CEO in China, frankly speeking, Solar Win!
http://www.freesolarpanelsuk.co.uk/ Allan

James, a useful insight and shows how mismanaged the government’s green policy has been.

I get the distinct impression that they are dropping renewable technologies for Nuclear, just another industry which we are handing over to another country (France) rather than doing it ourselves.

We are going to be a nation dependant on others for our power.
- Bob_Wallace
  
  On what do you base your feeling that Europe is dropping renewable technologies for nuclear?
  
  Certainly not on the fact that Germany, Switzerland and Belgium have decided to close their nuclear plants as soon as possible.
  
  Certainly not on the fact that no other European country has announced plans to build any new nuclear. Not even to replace those plants which are nearing the end of their lifetime.
  
  Certainly not on the fact that Europe is installing a lot of wind and solar generation. Even France is pouring their efforts into renewables.
  
  What could possibly lead you to decide that Europe is abandoning renewables and turning to nuclear?
http://pulse.yahoo.com/_SF7VRJBUTOQXOG3FZWDIQH3IUY joseph

What world is this guy in. Every country in Europe is or would like to cut solar subsidies as fast as they can. There are widespread business failures with 2012 and beyond clearly to be a major ‘bust’, and rightly so, for technologies that do not work fixing problems that do not exist.
http://pulse.yahoo.com/_SF7VRJBUTOQXOG3FZWDIQH3IUY joseph

Agendas and opinions are not science. The warmists have rode the AGW horse for over 30 years, changing their hat as the rest of us caught on to their charade. First it was global warming, and then it was climate change. Next came climate disruption all the time predicting catastrophic consequences. They seemed to have an insurmountable position as they morphed their belief into a theory that attributed all weather extremes – hot or cold, wet or dry, snow or no snow, glacial advance or retreat, greater or weaker hurricanes, changes in sea levels, and more to atmospheric CO2.

At the same time real science, real data, observations and reality caught up with these extremists. None of the catastrophes that they have predicted have come to pass. The earth’s temperature, as measured by NASA’s Aqua satellite clearly shows stable to declining temperatures for at least the last 15 years.

One might suspect that the end is near for these eco-terrorists and might even hope that the most egregious of them would be held accountable for the harm they have done to the earth’s peoples and economies. But I am afraid that this will never happen.

Within the next year or two, the world’s elitist environmental police, led by the UN, will seamlessly slide into a new meme, still proclaiming the same dire consequences and demanding the same draconian sacrifices this time not in the name of global warming but now in the name of sustainability.
- http://soltesza.wordpress.com/ sola
  
  Joseph,
  
  Do you think that the IPCC, (which is composed of the highest authorities on climate science) hasn’t taken your NASA satellite report into account?
  
  Eco terrorist? Uh.
  
  Either you are pushing some fossil-industry agenda here or you are simply an idiot.
Agbowley

There are simple solutions to the UK crisis.
The power companies have made huge profits – impose a windfall tax and put the proceeds in the FIT fund.

Have two extra FIT rates – one for the rent-a-roof business and another for local authorities. It is these two groups that have distorted the figures leaving the homeowner without a viable system and the collapse in the Solar industry.
A 30% drop on panel prices is only a small portion of the system cost and the cuts are disproportionate to the real system cost.

Common sense – which of course is a rare sense in Government…
- http://cleantechnica.com/ Zachary Shahan
  
  Good ideas/points.
  
  Hopefully some common sense will sprinkle in
- http://www.talksolarpanels.co.uk/ James Hawkins
  
  I think the government’s figure of 30% actually covers the total cost of an installed system. The UK’s capacity to install solar has massively expanded (there are more than 3,000 registered solar installers). For example, we generate enquiries on our website. The cost per person putting in their details has risen from £14-15 to £28 or more, due to the number of extra companies advertising on Google (we get some of our traffic through Pay Per Click adverts). Obviously, there are a lot of other things that can influence this, but it is a good indicator that the level of competition has risen, driving down margins.
  
  The rent-a-roof models where massive companies install solar panels for free on homeowner’s houses and then take the tariff themselves, providing the homeowner with free electricity, have indeed probably had a very harmful impact – it means companies with a massive amount of capital are now making incredibly large profits, so it’s not really sustainable as a long-term scheme. Even at the new, lower, rate in the UK, there are companies still willing to install solar for free because they estimate they’ll manage a return of about 5%, which is still a good, stable, investment. The problem is that once homeowners have read about all the changes, without doing as much research, they get scared off and so the market is likely to drop in volume over the next year by a very large amount.
  - http://cleantechnica.com/ Zachary Shahan
    
    Thanks for the added insight here. Very interesting.
http://k.lenz.name/LB Karl-Friedrich Lenz

Some of the numbers of this article must be wrong. Germany’s 2011 installation of 7.5 GW is correct, but Europe as a whole at 14.3 GW can’t be right if the graph showing Italy jumping from less than 4GW to more than 12 GW in 2011 is right, since 7.5 plus 8 would already be more than 14.3.

The European Photovoltaic Industry Association reported 20.9 new connections in 2011 for the EU, and 9 GW for Italy (beating Germany). That would seem to be a more reliable figure.
- http://cleantechnica.com/ Zachary Shahan
  
  Hmm, I think it’s a result of James getting his info from diff sources, diff countries mostly. But obviously need to have the numbers match up. Will have him retrace his steps here and adjust the article asap.
- http://cleantechnica.com/ Zachary Shahan
  
  Nevermind, I see what the issues are.
  
  1- Yes, looks like he used different data (from iSuppli) for total new EU capacity — I switched out that number and link to use EPIA’s info instead. 2- The charts are actually of total cumulative installed capacity (not new capacity) — i tried to clarify int he text.
  - http://www.talksolarpanels.co.uk/ James Hawkins
    
    Sorry for the confusion – I should have stated what was being shown more clearly. Thanks for sorting it out!
    - http://cleantechnica.com/ Zachary Shahan
      
      No prob. I’ve run into that problem in the past when presenting both new and cumulative installed capacity in one post.
Zer0Sum

The elephant in the room is where is all the energy to manufacture all this renewable energy infrastructure going to come from?

Fossil fuels are being consumed exponentially and oil is now 6 years past peak. Which means that the majority of what is left in the ground is energy negative to extract, refine and bring to market.

So while they might be aiming for 30% of European energy supply by 2050 they only have the rest of the decade to take advantage of the abundant and rapidly depleting supply of petroleum.

Does this mean that they have already factored in a rapid decline in total consumption to allow them to achieve that 20-30% capacity?
- Bob_Wallace
  
  The simple answer = “More and more from renewable sources”.
  
  Remember, if energy was not going into manufacturing wind and solar capacity more energy would be going into building nuclear/coal facilities and mining coal.
  
  What Europe is now doing is using some of the manufacturing energy that they would have used any way to produce generation which will operate fuel-free for many decades. As each year goes by they will expend less and less coal/nuclear energy to produce the same amount of renewable generation.
  
  As each year goes by the input from fossil fuels drops.
  - Zer0Sum
    
    Most of the energy being used to manufacture the renewable energy comes from the traditional sources. So while it is nice to say that we can gradually replace them the truth is we don’t have the luxury of a gradual replacement process. As we consume exponentially greater amounts of traditional fuel sources to build the renewable economy we end up depleting the reserves beyond what we can replace with the new economy. In the meantime we are still consuming large amounts of the traditional fuel sources just for traditional uses.
    
    At the moment the use of fossil fuels is still increasing. The only point that it will start to decline is when it it no longer available to use. The fall off from that is a very rapid decent.
    - Bob_Wallace
      
      The energy payback time for most silicon PV is under two years. For some silicon PV and all thin film PV the payback period is less than one year.
      
      If Europe puts X amount of solar on line in 2010 then it will generate enough power from solar in 2011 to produce another X amount of solar in 2011.
      
      In 2012 there will be enough solar on line to produce an additional 2X of solar.
      
      As more wind and solar come on line less fossil fuel it used to generate additional renewable generation.
      
      That said, we’re not going to run out of fossil fuels in the next 20, 30, 50, 100 years. All that will happen is that it will become more expensive.
      
      And, if we’re smart, we’ll cut back on the use of fossil fuels for environmental and health reasons.
    - Zer0Sum
      
      @ Bob_Wallace
      
      The problem is that the clear Majority of Solar PV comes from China and they are using mostly Australian coal for their energy supply and US silicon for their base material. So even though a lot of the EU might be able to ramp up installation of Chinese manufactured PV when the oil becomes completely energy negative how are they going to transport it from China? Currently they do not have enough local manufacturing infrastructure to take up the slack. The window is closing and this decade is crunch time. It’s simple arithmetic…
    - Bob_Wallace
      
      Zero, I have no idea how the idea got into your head that we’re going to run out of oil in the next few decades. I suspect it’s a misunderstanding of what “peak oil” means.
      
      Peak (cheap) oil almost certainly happened some years back when we no longer were able to find new supplies as quickly as we used up known supplies. But that does not mean that we’re going to fall off an “oil cliff” in the near future.
      
      What it means is that oil will get more expensive. The oil we burn will require us going further/deeper and refining some low quality stuff rather than sweet crude.
      
      That, in turn, will lead to greater efficiency, seeking alternatives (such as the crappy sand tar stuff now coming out of Canada and biofuels) and total replacements such as EVs.
      
      We need to quit using oil and coal for environmental reasons, but we’ll continue to use both until they are replaced by cheaper/cleaner renewable energy. Ocean shipping and air flight are likely to be the last things to give up oil. It will get more expensive to ship and fly, but it will also get cheaper to drive.
      
      The window is not closing in the real world. This decade is not crunch time. Someone has sold you a boatload of “stuff”….
    - Zer0Sum
      
      @Bob_Wallace
      
      I suggest you take a look at the exponential growth curve for Oil consumption which has been steady for the past 100 years. With a doubling period of approximately 10 years.
      
      With every doubling period we consume as much as all the previous years combined. That means that when we hit peak oil in 2006 we also hit the last doubling period and from now on the only option is sliding down the oily, violent and blood soaked slope of rapidly declining reserves as the big players attempt to steal what’s left from their neighbours.
      
      It doesn’t take a genius to understand the exponential growth curve.
      
      Ask any true oil expert who is not paid by the oil industry to cover up the story and they will tell you it’s crunch time. Energy positive oil has been depleted. It doesn’t matter how much hyper inflated cash you print to throw at the problem as it still requires more energy to get it out of the ground than it provides once out which means we consume more energy every day to get access to the remaining reserves. All the Oil producing nations are aware of this rapid escalation in their internal consumption. They just don’t like to talk about it in the media very often.
      - Bob_Wallace
        
        Well, here’s a quick and dirty on world oil consumption from 1980 (~60,000 to 2006 ~85,000 thousand barrels per day).
        http://en.wikipedia.org/wiki/File:Oil_consumption_per_day_by_region_from_1980_to_2006.svg
        
        That’s a 40% increase in 2.6 decades, nothing like a doubling every decade.
        Is our EROEI ratio dropping for oil? Certainly.
        
        Does it make sense to switch from oil to renewable energy? Certainly.
        Are we going to run out of oil in the next decade? Certainly not.
- Luke Davia
  
  I’m not disagreeing with you here – but can I ask where you got the ‘6 years past peak oil’ fact from? It sounds interesting.
  - Zer0Sum
    
    The majority of real experts not the ones paid by interest groups to pretend they are experts agree that peak oil was in 2006. Many will even tell you that because the oil producing companies are gaming the markets to increase their book reserves it was as early as 2000.
    
    The Oil will not run out completely but it will become less and less available as most of it is now considered energy negative. That means it takes more energy to get it out of the ground than it provides once it is extracted, refined and transported to market…
Bill_Woods

“Germany … now has 24 GW of capacity installed in total, generating approximately of their electricity.”

Missing number: generating 3%.

Germany wants to cut the level of annual installations to less than half of the 7+ GW/yr of 2010 and 2011. Spain and the Czech Republic have also gone through their booms and busts.
http://www.greentechmedia.com/articles/read/first-solar-on-the-future-of-photovoltaics/
- http://cleantechnica.com/ Zachary Shahan
  
  Sorry, that was in the original and I accidentally deleted it when cleaning up some code. Thanks for the catch.
- http://www.talksolarpanels.co.uk/ James Hawkins
  
  I think the challenge will be making sure they do this in a predictable way. For example, the main issue with the UK was the instability caused by sudden changes in government policy. This means that in economic terms more now has to be paid in subsidies to achieve the same level of uptake because people investing will be factoring in their perceived risk.
  
  It is a good point that the ongoing costs of such a scheme are just going to increase and increase. I think the hope is that in the long run, if there is enough demand created, the technologies will improve to the point where solar is equal in price per kWh terms to non-renewables, but it will take a lot of fudning to get there. If every country had put in the effort that Germany have, alongside the same stability and predictability of policy, then imagine what the world market for solar would be like. I just hope this doesn’t turn out to be a dream!

CleanTechnica is the #1 cleantech-focused
website in the world. Subscribe today!