German renewable industry booming

BERLIN, March 24 (UPI) -- Countering Germany's overall economic trend, the renewable energy industry boomed in 2009, supplying more than 10 percent of the country's energy for the first time.

"We have made delightful progress," German Environment Minister Norbert Roettgen said upon unveiling of the renewable data Wednesday in Berlin. "Germany is a global market leader in the field of renewable energies."

Renewables -- including biomass, geothermal, hydroelectric, wind and solar energy -- accounted for 10.1 percent of the overall energy mix, up from 9.3 percent in 2008. Renewables produced 94 billion kilowatt hours of power in 2009, a share of 16.1 percent, up from 15.2 percent in the previous year.

That puts Germany in a comfortable position when it comes to reaching its targets of boosting renewables in the energy mix and at the same time reducing greenhouse gas emissions.

Renewables in 2009 avoided 109 million tons of emissions; Germany has reduced its emissions levels by 28 percent compared to 1990 levels.

Roettgen said it was "very realistic" that Germany before 2020 reaches its target of a 30 percent renewable share in the power mix and by the same year reducing its emissions by 40 percent compared to 1990 levels.

The German renewable energy sector has benefited from a generous feed-in-tariff provided by famous renewable energy law, or EEG.

Last year, the German renewable energy industry unlocked investments worth some $23 billion, in a year when the overall economy contracted by 5 percent. The sector employs 300,500 people, that's almost double the 2004 figure.

"The sector is growing against the trend and it remains a job and economic motor," Roettgen said.

It's not all positive news, however: The solar energy industry has turned into a problem child.

The feed-in tariff requires large utilities to buy up power generated by solar panels at prices several times the market value. This has led to German companies leading the global solar power market but also in an excess capacity within relatively chilly Germany: The country in 2009 accounted for more than half of global panel installations, meaning that billions of dollars in subsidies go to their owners. Despite those massive subsidies, solar accounts for less than 1 percent of the overall energy mix in Germany.

This over-funding "discourages technological advances and lowers the acceptance of renewables with the public," Roettgen said, adding that subsidy cuts were imminent. "We don't want to use the EEG to subsidize solar investment funds that enjoy double-digit returns."