Italy’s Robbery Of Solar Investors Hard To Rationalize, Says Photon Energy CEO

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Italy’s recent move to introduce retroactive anti-solar measures is a form of robbery according Photon Energy’s CEO Georg Hotar.

And while it’s to be expected that the Southern European country’s move would have investors and many in the industry foaming at the mouth, it’s still quite hard not to agree that it is essentially robbery, and perhaps even harder to rationalize.

Image Credit: Solar Italy via Wikimedia CommonsImage Credit: Solar Italy via Wikimedia Commons

What is a country that is so hugely dependent upon imports for its energy doing destroying its only real avenue for improved energy independence? Especially when you factor in the ever-rising price of importing energy, and the ever-growing instability of many of the energy-supplying regions of the world?

Really makes you wonder.

Italy’s recent move is largely expected to “cripple equity investment and damage the country’s reputation.” The country certainly isn’t alone in that regard, though, as Photon Energy notes:

Italy has joined the ranks of other European Banana Republics such as Spain, Greece, Bulgaria, Romania, Slovakia and the Czech Republic by spreading the anti-solar cancer of retroactive measures against operating PV assets. Wrapped in legislation designed to increase competitiveness, the Italian government is delivering a fatal blow to equity investors in PV plants with a capacity of 200+ KWp, undermining any remaining confidence of financial and industrial investors in Italy as a credible investment destination.

Boom. Not sure that referring to those countries as “Banana Republics” stands on solid ground, but the broader point does — potential investors will now be looking at the country with quite a different set of eyes.


“To add insult to injury, we are invited to choose the method of execution for our investments”, states Photon Energy CEO Georg Hotar. “Investors are being forced to choose between an 8% reduction in the feed-in-tariff paid by the state agency GSE for the remainder of the support period or opting for the FiT to be spread even more thinly over a total of 24 years (compared to the original 20 years). Effectively a reduction of 17-25% is expected to apply depending on the residual time.”

“With Italy’s reckless attack on investors the second-largest European PV market has been destroyed. Bona-fide investors are being systematically targeted across the EU. The European Commission is not only letting it happen but is instrumental in removing Bilateral Investment Treaties between EU member countries, which have traditionally been a last line of defence for investors.”

“Investors, together with a plethora of Italian and international banks, have deployed some €50 billion in good faith and are now the victims of a highly irresponsible government,” continues Hotar.

And, as the Photon Energy CEO notes, the country is currently heavily dependent upon the bond market, and its perception amongst financial investors, owing to its substantial debt (120% of its GDP) — is this really a smart decision?

“How the investment community will like state-sanctioned robbery will become evident shortly in the bond market,” finishes Hotar.

Hmmm. I guess that we’ll see.

For those wondering about the reasons for the cuts, they come (ostensibly) as part of Prime Minister Matteo Renzi’s initiative to cut power bills by 10% to help struggling households and small firms.

While the measure may certainly achieve that end, if it damages the investment climate, is that really worth it? Politics…


Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Latest CleanTechnica TV Video


Advertisement
 
CleanTechnica uses affiliate links. See our policy here.

James Ayre

James Ayre's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy.

James Ayre has 4830 posts and counting. See all posts by James Ayre