A core facet of Chancellor Merkel’s historic “Energiewende” clean energy transition, Germany has led the world in driving adoption of solar energy technology and systems. Although it is now pulling back hard on incentives, the market momentum created by its precedent-setting solar energy feed-in tariff (FiT) persists.
Three national solar energy records were set in Germany over the past two weeks. According to the Fraunhofer ISE solar energy research institute:
- Solar met more than 50 percent of Germany’s total electricity demand for the first time;
- A new solar peak power production record was set; and
- Weekly total solar power output hit new highs.
That’s not all. With prospects for new, cheaper and more effective energy storage solutions improving, sales of solar power storage systems are “set to skyrocket in Germany,” according to German economic trade and development agency GermanyTrade & Invest.
Solar records falling fast in Germany
Fraunhofer’s latest analysis of solar photovoltaic (PV) electricity production showed that a record-high 24.24 gigawatts (GW) were generated between 1 p.m. and 2 p.m. on Friday, June 6, and a total 1.26 terawatt-hours (TWh) over the entire week.
Solar power production peaked at 23.1 GW on June 9, a national holiday — representing 50.1 percent of total electricity demand, another milestone, Germany Trade & Invest highlights.
Commenting on solar’s record performance, Tobias Rothacher, a renewable energy expert at Germany’s economic development agency stated:
“German solar demonstrated just what it is capable of in the first two weeks of June. “The large amounts of solar electricity being generated demonstrate clearly that Germany will need more energy storage capacity in the future. Already, the more than 1.4 million photovoltaic systems are producing a surplus, especially on sunny days around midday.”
The clean energy economy: A virtuous spiral
Evidence that clean energy policies can fuel the creation of a positive socioeconomic feedback loop, Germany’s growing solar PV and renewable energy production is driving development of innovative energy storage solutions. As Rothacher pointed out:
“From now on, every new solar system that is installed in Germany increases the need for electricity storage solutions. The cost of storage systems is forecast to drop in the coming years and this means that storage is not only becoming more necessary – it is becoming more attractive from a financial point of view as well.”
The German government and participants in the country’s clean energy storage sector are taking their technology and the lessons they have learned overseas. Germany Trade & Invest experts are traveling to the Energy Storage China 2014 conference and exhibition, which is to take place in Beijing June 23-24, “to advise international investors about relevant opportunities in the German market.”
Solar energy’s geopolitical ramifications
Solar energy’s rapid rise in Germany has profound and far-reaching ramifications, and not only for Germany. Cleaner energy means cleaner air, cleaner water and healthier, more productive landscapes. It also makes for healthier people and a healthier, more vital economy and society. It helps conserve biodiversity and wilderness — and all the ecological services and social, as well as economic, benefits they provide.
Germany’s solar and renewable energy leadership can serve as a model for other nations and the international community as they head into the “home stretch” of negotiating a successor to the United Nations Framework Convention on Climate Change (UNFCCC) Kyoto Protocol.
The rapid rise in German solar energy capacity also brings to the fore the tremendous potential for solar, wind and other distributed renewable energy sources to reshape the geopolitical landscape for the better. Neuter the economic significance of oil and gas deposits in developing nations, and we might just able to do away with a host of ills that have plagued humanity for over a century.
Germany is not known for its abundance of sunshine. That makes solar energy’s success there even more remarkable. Another thing that truly distinguishes solar energy’s success in Germany is that it’s so democratic in nature.
Germany’s democratic solar PV growth
Here in the U.S., utility-scale solar capacity far outweighs what has been installed in the residential and commercial sectors. In Germany, residential and commercial rooftop PV installations far outnumber utility-scale PV plants.
Solar energy pundits have put the difference down to government policy. Germany instituted a sector-wide solar feed-in tariff (FiT) that requires utilities to pay more for solar-generated electricity wherever it is produced. That was the pivotal piece of legislation that has spurred the phenomenal rise in rooftop PV in the country.
Here in the U.S., the federal government has relied instead on investment and production tax credits to stimulate growth in the solar, wind and renewable energy sector.
Though the federal tax credits do play a big role in making investment in solar energy more attractive to homeowners, tax equity investments are the realm of large investor groups and corporations. It’s been the recent advent of third-party solar leasing programs and the securitization of solar leases that have been accelerating adoption of solar PV on U.S. rooftops.
More successful in launching renewable energy incentive programs, state governments have supplemented the federal PTC and ITC with renewable or alternative portfolio standards (RPS and APS). Governments in 30 states plus the District of Columbia have passed an RPS or APS. Last week, Ohio became the first to freeze its APS, which was enacted in 2008.
Again, however, these standards mainly drive demand for solar and other renewable energy systems in the power utility sector, requiring them to purchase an increasingly high percentage from renewable sources over time.
The importance of social attitudes and national values
People’s attitudes and values also undoubtedly play a big part in determining the rate and extent to which homeowners, businesses and utilities adopt solar energy systems. Here in the U.S., oil, gas and coal companies wield much more in the way of political and media power, and hence, public influence, than they do in Germany.
This difference in attitudes and values can be traced back to the role oil, gas and coal has played in Germany and America’s socioeconomic development and growth. The U.S. was the birthplace of the multinational oil industry giants and remains their most important market. With the energy advantages of oil and natural gas made clear over the course of two world wars, oil — and the interests of the oil and gas multinationals — became central to the U.S. government’s foreign and domestic policy, and vice versa.
Coal played a central role in Germany’s industrialization, but that was over a century ago. With no substantial domestic oil and gas deposits to speak of, no counterpart to the Standard Oil Trust, or today’s Exxon and Chevron, emerged in Germany, and that remains the case today.