But it doesn't say why. The reason is because grid power is more expensive in Germany: $0.30/kWh compared to $0.10/kWh on average in the US. Therefore potential customers are easier to convince to use solar in Germany.
On a broader note, I don't get why we think it's a good thing for Germany to have this much solar energy. Unlike, say, Spain, the German climate is not especially well suited to solar power. It's too far north, as a country, and climatically, Germany has a lot of cloudy days, which means that solar panels are not really running at peak efficiency most of the time. Germany would be much better served by wind power, because of its advantageous position on the North European Plain. In a free market, that is exactly what would have happened. Instead, German government subsidies have unfairly advantaged solar energy, leading to an inefficiently high number of solar panels and underinvestment in wind.
If you check the insolation maps you will find that southern Germany is surprisingly sunny. Their cooler temperatures also help with efficiency.
Going off on a tangent, I lived in New Mexico (5.5 on that table). A friend bought German solar panels for his house. He then had to get an upgraded transformer, because it put out too much power for the stock German one to handle.
Wind power requires more territory per watt than solar and German population is dense just enough that wind power is on the edge of pay-off.
estimated electricity production for Germany in 2012:
* Wind: 45 Billion kwh
* Solar: 28,5 Billion kWh
A solar industry insider told me one of the worst solar markets in California is Palo Alto. Wealthy, green, suburban, techy: how can this be? The city runs its own utilities and makes it hard to install (apparently).
Regulations need to be streamlined.
What varies are enforcement standards and local conditions. Some local conditions such as earthquakes and hurricanes are environmental. Others such as zoning and other land development regulations are political (and some of the most extreme regulations are private in the form of covenants upon title to the land).
There are sound reasons for regulation and enforcement (and unsound ones as well). Among them are life safety issues. Unlike grid power, solar panels have no disconnect. They remain live while exposed to sunlight. This creates a hazard during fires and similar emergencies. It creates a new class of hazard during electrical repairs and unrelated tasks such as re-roofing or cleaning gutters.
Wealthy and suburban tends to correlate with all construction projects being difficult to permit because such jurisdictions have more vocal and resourceful citizens with a concern for maintaining property values.
If one goes to the sticks, there are still places in the US which don't require a building permit.
edit: it's not 3x but still as high as 2.5x in some places: http://www.nrel.gov/gis/images/us_germany_spain/pv_map_us_ge... and more if you compare to northern Germany. Anyway some parts of the US have significantly higher power costs than others (not surprisingly these are generally good solar sales markets)
* Having to make a decision
* Opportunity cost (doing this deal means not getting some other solar arrangement and means not getting next year's better technology)
* "To qualify for financing, you need to have excellent credit (a FICO score of 700 or greater)."
* Some of us don't like companies that keep basic information off the Web and require you to talk on the phone to a sales rep: "Availability of SolarPPA and SolarLease vary by location based on what your local utility company prefers." ... "Financing terms vary by location and are not available in all areas. To find out which plans are available in your area, request a free consultation."
* Not knowing people in-person who will vouch for the company's honesty and good service.
I suspect what you see on their website is just to grab customers. They don't try to snow anyone, at least IME. They will give you sheets that show exactly what they estimate and are willing to guarantee a year, and show exactly how all the numbers are derived.
5 of my friends (all engineers, actually) are doing PPA's as well.
A few things:
1. Sadly, a lot of folks try to compare generation charges vs what solar city is asking you to pay.
For example, in my area, Pepco's generation charge is 8.9 cents, and my PPA with solar city is 6.5 cents.
Not so great, right?
However, when you include pepco's distribution charges, various tariffs and taxes that i don't have to pay solar city, etc, the actual pepco cost is closer to 14 cents a kwh (i'm going by my actual power usage divided by actual utility bill cost).
I am probably a weird case, but i have saved plenty this year. Since i'm on a PPA, as long as the PPA rate stays below pepco's rate, i will always save money.
2. The PPA numbers they guaranteed me vs actual generation amount is pretty spot on. They are very good at calculating the actual power generation of the panels. They do not overpromise and underdeliver (and as i'll get to, they guarantee this by contract). For this year, I was guaranteed 10400kwh of power at 6.5 cents, and so far, i've generated ~10320kwh with 4 days left.
For example, I know they calculate historical cloud coverage using real data (google earth, et al)
The PPA contracts have two sets of performance guarantees:
Under and over:
First, for every kwh they guarantee but do not deliver, you get exactly the right amount of money back. IE i was promised 10400kwh this year, and paid 6.5 cents per kwh for it. If i do not generate that much, they pay me exactly 10400-actual generation * 6.5 cents. So you always at least get your money back (though yes, this is effectively giving them a loan). In some PPA's they do the refund price is greater than the actual price, so that there are teeth to them not meeting the guarantee.
The other underperformance guarantee is that if they are under performing by more than 10%, they are required to do whatever is necessary to ensure this does not happen the next year, or they are in breach of contract (and there are plenty of penalties on their side for this). I know of cases where they've installed tracking systems, etc, in order to make this happen.
They also have overperformance guarantees.
If my system overgenerates (which for me, is profitable, as i'll get to), I pay 6.5 cents per kwh, up to 20% of the yearly number guarantee. Over 20%, I don't pay them unless i am able to sell the power myself.
So you do have upper/lower bounds on the numbers, set by contract, though historically solar city installs are within a very small percentage of the guaranteed numbers
3. At least for me, overgeneration is profitable. Maryland is a net energy state, and pepco is required to pay me the residential generation rate. It comes in the form of net energy credits that carry over month to month, and any remaining excess is paid out in real money at the end of each year.
So if i were to generate 100000 kwh on my panels (let's assume this is under the 20% number i gave above), but only use 10000kwh a year, i would owe solar city 90000kwh6.5 cents. Pepco would then be required to pay me 90000kwh8.9 cents.
So you can actually make money on the deal if solar city messed up the numbers.
4. Because it's a PPA, i am not responsible for anything but giving them access to my roof. They are also willing to guarantee all roof penetrations, and any repairs needed because the panels are there. If the panels explode, break, etc it isn't my problem. Any defects/failures that are in the panels does not suspend their performance guarantee.
Note that I am also a prepay PPA, so my PPA rate never increases. If you can float the money, and will stay in the house for a long time, you should always be able to make your money back, unless your local utility suddenly decides to start charging people a lot less.
The real case it doesn't make sense is if you are going to need to break the lease.
Rereading the above, I realize it sounds a bit like a commercial, but it's really not. Other than the lease length issue, it's often a pretty good deal. The funny thing is, i'm moving, so I will end up transferring the PPA when I sell the house. Even though i prepaid, it looks like i'll still make the money back that I spent in increased home value.
(People value homes in funny ways)
Interest rates are at all-time lows. Lending standards may make loans unavailable, but the cost of capital is anything but high.
This is a result of the silly panic over fukishima in Germany and the greens being brought off to keep Adrea Merkal in power.
Germany's use of solar drove up prices of silicon in 2004.
> The price of solar panels fell steadily for 40 years, until 2004 when high subsidies in Germany drastically increased demand there and greatly increased the price of purified silicon (which is used in computer chips as well as solar panels).
Home owners are a lot more willing to put money into their property today, i.e. invest money today for the vage promise of the government paying it back over the next 20 years. This seems a much more value creation oriented idea than just to stimulate short term consumption.
And besides, this is about the cost of the installation. You did read the article?
"They pay more in sales tax (German installers are exempt)."
But you're right, that the largest subsidy is not paid out of tax money, but through a (very large ) mandated surcharge on private utility bills. There's little practical difference. It's functionally equivalent to a tax subsidy funded by a tax on electricity.
If you register your private solar installation as a business, you are exempt from paying sales tax if you also pay revenue tax (= sales tax) for the energy you are selling. Just like the baker buying her oven, if a business buys something for the business, it is (usually) exempt from paying sales tax for it – since sales tax is supposed to be only paid once, not several times.
You know, what annoys me is ignorance about the actual policies and then pontificating as if you have it all figured out.
An I am a pro EU guy you can see why Ukip are gaining in popularity
That's even better than a tax break. Who can turn down free money?
I have a family member who has a large array on his roof and he runs his entire house and charges his Tesla all off the grid. He's still connected, but in most cases he runs a $0 bill.
If you live anywhere that's hot much of the year, it's a great deal, dropping your electric bill precipitously and recouping costs often in 2-4 years in that type of situation (as opposed to 7-12 in less reasonable areas). Also due to the nature of how cheap the electricity is during the day, you can set the A/C low during the day "coast" off the temperature differential during the night closer to a temperature you'd like.
Bad areas for solar: Constant cloud cover, Lots of overhanging Trees, far northern latitude. I would not use it in Alaska, Portland or Atlanta for these reasons.
Those large green trees? They're 60-160 feet tall. Drop branches every severe wind. There all over the place (Although most are under a hundred feet tall). They knock out our power lines, our cable lines and when they fall, our houses (luckily most people remove them long before that point).
There are certainly suburban areas near Atlanta where they've been clear cut in their past as part of their transformation into chicken farms (Before being turned into housing), and those locations would likely be EXCELLENT areas for solar panels.
But anywhere that has original trees, nope.
There might be a bit of conspicuous environmentalism, but it's probably mostly about permitting and property rights issues. No one would lease you the roof for $50/month so that you can install panels over them, but they'll happily install their own.
BTW, Germany has been a pioneer in this regard too as it developed the PassivHaus standard for energy efficiency in buildings. The standard is over a decade old and it's been demonstrated that existing or older housing stock can also be retrofitted to meet the standard (although it can be expensive).
But even without the rigour of the PassiveHaus standard, there are many other techniques to substantially improve the insulation of existing buildings so their energy costs shrink. To me, it seems sensible to think about reducing our energy consumption as well as finding alternative, cleaner (greener) technologies.
Examplified in this joke:
'Why do Englishmen put their pipes on the outside of the house?
- Because it is simpler to exchange them when they freeze.'
Also transmission to places where real estate is cheap is costlier than you'd think, largely due to red tape.