Thanks to a generous feed-in tariff, the installation of rooftop solar panels and large-scale photovoltaic plants has exploded in Germany.
Stephan Kohler, chairman of the DENA agency, an energy adviser to the government, has warned that the green boom could turn into a disaster for Germany's aging power grid.
"The network is facing a congestion due to solar power," Kohler told the Berliner Zeitung newspaper. "That's why the expansion of solar power has to be cut back quickly and drastically."
Experts have long called for an overhaul of the European power grid to integrate the fluctuating renewable energy sources such as solar and wind power.
Experts forecast between 8 gigawatts and 10 GW of solar power capacity to be installed this year -- the equivalent of roughly 10 large coal-fired power plants. In 2009, only 4 GW were installed.
Well aware that the industry is maturing more quickly than anticipated, Berlin this year agreed to reduce subsidies for rooftop panels by 16 percent.
The decision helped the German industry to a first-half sales boom, as private customers ordered panels in droves to beat feed-in-tariff reductions set for this summer.
Strong sales have continued until now, however, with experts forecasting a similarly strong 2011 when it comes to new installations. If the current trends continue, Germany would have a solar power capacity of nearly 50 GW by 2013.
"That would be a catastrophe for the grids," Kohler said, urging the German government to cap the installation of new solar panels at 1 GW per year. "Then we could reach the manageable benchmark of 30 GW in 2020," he said.
The German government through the Renewable Energy Law, or EEG, regulates the feed-in-tariff aimed at boosting power production from renewable energy sources. Paid by German taxpayers via their electricity bill and guaranteed for 20 years, the levies vary from 21 cents per kilowatt-hour for offshore wind turbines to 46 cents per kw/h for roof-mounted solar panels.
Berlin has vowed to gradually reduce subsidies but EEG-related costs will nevertheless rise significantly over the coming years, experts have warned.
The German consumer association VZBV claims that the solar panels installed in 2010 will result in additional costs of $36 billion during the next 20 years.
The German government has so far not voiced plans to limit solar power installations; an overhaul of the EEG isn't planned until 2012.
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