Germany’s Green Revolution Turns Into A Bloodbath – “Solar Valley” Literally Gets Obliterated

German daily Süddeutsche Zeitung here reports on another major German solar manfuacturer that has gone insolvent. A week ago solar cell and module manufacturer Sovello declared insolvency.

The company employs 1200 workers and is one of Germany’s “Solar Valley” enterprises along with Q-Cells that had been expected to lead Germany into a new age of high-tech for the future.  Germany’s Solar Valley is located at the junction of the states of Saxony, Saxony Anhalt and Thuringia in East Germany, and received massive investment and support from state and federal governments.

Now its workers are waking up to empty promises, dashed dreams and bitter reality. Solar Valley joins the scrap heap of failed East German economic and social experiments, the last being the German Democratic Republic which collapsed in 1989.

Q-Cells reported it was insolvent in early April. Also US manufacturer First Solar delivered a massive blow to the region, announcing it would close its plant in Frankfurt (Oder).

The collapsing solar branch in Germany was one of the main reasons Angela Merkel sacked Environment Minister Norbert Röttgen two days ago. The German solar industry is also dogged by low price competition from China and reduced subsidies for solar system operators, which earlier had spiraled out of control and led to spiraling electricity prices that have put many in a state of energy poverty.

The Süddeutsche Zeitung reports:

In 2005 Sovello was founded as a mutual company by Q-Cells and US manufacturer Evergreen Solar. Three production lines were built in succession. Two years ago the company was taken over by a private equity investor and the corporation was changed over to a limited liability company.

The pleas for help for the branch have become louder. After the German states voted to stop the cuts in the feed-in tariffs for the time being, direct intervention by the state is now being demanded. Former IWH director Ulrich Blum supports the state intervening on behalf of the battered solar branch in the East…”

Readers I’m sure are getting the picture by now. The state never learns, does it? They want to keep experimenting.

The media, on the other hand, have considerably toned down their enthusiasm for solar energy and the green economy.

Germany’s green revolution has turned into an embarrassing bloodbath.

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PS: I personally took advantage of the generous subsidies and had a 12-kW system installed on our home 2 months ago. Yet, the power company still hasn’t come around to do the final hook-up and so I’m sitting here with a €20K system that’s doing nothing. Truly the whole solar thing here in Germany is a huge mess. Not a single government official even took a minute to think about it before diving in.

 

22 responses to “Germany’s Green Revolution Turns Into A Bloodbath – “Solar Valley” Literally Gets Obliterated”

  1. DirkH

    “Not a single government official even took a minute to think about it before diving in.”

    I disagree. The subsidy scheme in the form of the EEG law was cooked up by Social Democrats and Greens. They are what Thomas Sowell calls stage one thinkers. So, they though about it long and hard with their bird brains, oh sorry, didn’t want to insult birds; unlike leftists, some of them are toolmakers…

    http://www.amazon.com/Applied-Economics-Thinking-Beyond-Stage/dp/0465081436

    On that stage one level of thinking, you DESIRE something and take measures to make it real, but you don’t think about the systemic effects. We see that in Malthusians as well, all the time.

    From one of the reviews of the book:
    “He reminds the reader that politicians do not think beyond Stage One because they will be praised (and elected) for the short term benefits but will not be held accountable much later when the long term consequences appear.”

    In fact, the current crisis in the electricity supply of Germany AND the Greek crisis both go back to 1999 resp. 2001, when Schröder’s Red-Green government was in power. 1999 the EEG was enacted, leading to the current solar fallout, 2001 his government agreed to give Greece the Euro. Schröder and his green allies were voted out in 2007 but their financial time bombs go off now – long after they were ditched. Just like Sowell says.

    1. Casper

      SPD, CDU/CSU, Grüne, FDP, Piraten. I can’t distinguish between them. Each of them is a socialists to me – in other words it’s a band of thieves. As far as I remember the story of the EEG has begun in the Kohl’s era.

      1. DirkH

        Kohl only had a tiny limited prototype program. The EEG is from 2000.
        http://de.wikipedia.org/wiki/Erneuerbare-Energien-Gesetz
        Ursprüngliche Fassung vom: 29. März 2000
        (BGBl. I S. 305)

        Under Kohl, there was a law that guaranteed renewable energy priority when fed into the grid,
        http://de.wikipedia.org/wiki/Stromeinspeisungsgesetz
        but the compensation was the average price of the bulk electricity prices – so basically not a subsidy.

        Kohl made other mistakes – giving up the D-Mark (but one could argue that he was forced to do that to get French permission for the reunification of Germany) – and greatly raising taxes to pump money into the rebuilding of the DDR.

        1. Bernd Felsche

          And they rebuilt the DDR. It now covers all of Germany. 🙁

        2. mwhite

          You might find this interesting

          http://www.bbc.co.uk/iplayer/episode/b01hy4xr/The_Great_Euro_Crash_with_Robert_Peston/

          “The Great Euro Crash with Robert Peston”

          The European project and AGW very similar.

  2. Casper

    Thank you for additional info. Anyway, Kohl had done a fundamental work, and I don’t believe he didn’t know what he was doing at that time.

    The EU is a German-French project since its beginning. It’s an insurance against a case if Germany had started a war again. However, Germany may wage a war without any army…

  3. BargHumer

    So today we get some answers to yesterdasys questions. Why did Merkel fire this guy? One of the main reason was the collapse of the solar “branch”. This is odd, because it suerly could not have been this ministers fault – a minister doesn’t act alone, he just takes the hit when it goes wrong. I wait to hear what any of the other main reasons are.

    1. DirkH

      I said it before – Merkel has promised to keep the EEG cross subsidy at 3.5 Eurocents per kWh; it was Röttgens job to make that happpen and he failed – prognosis says 4.5 cent next year.
      http://www.youtube.com/watch?v=84zY33QZO5o

      1. BargHumer

        Yes, I saw this in the other thread. Surely he is not the only one responsible for this failure, and if so, firing him is not a solution for fixing it. I would expect something more fundamental bearing in mind the projected collapse of the German elecrticity supply in a few months.

  4. thebiggreenlie

    Here in Ontario Canada we will follow the German example and pay dearly for this massive Green fraud!
    When bad leaders buy into bad ideas and pass bad laws that never get repealed equals the “Death of an Economy”
    Here our Government offers .80 cents CAN per Kwh. for solar through it’s Feed in Tariff program that was developed by your Hermann Scheer.
    God help our futures!

  5. Bernd Felsche

    http://www.world-nuclear-news.org/NP_Power_shift_begins_to_move_German_industry_1805122.html
    ————
    Germany’s third largest aluminium producer has filed for bankruptcy as trade groups call for affordable power supply equivalent to the nuclear capacity taken off the grid as a response to the Fukushima accident.

    “Production of metals, particularly aluminum, is at risk in Germany due to high electricity prices that are no longer internationally competitive,” said [Ulrich] Grillo [President of Germany’s trade body for the metal industry, WirtschaftsVereinigung Metalle (WVM)].

    German users of over 20 GWh per year pay 11.95 euro cents per kWh, compared to 6.9 cents in France, according to energy.eu data for November 2011. Among the 27 EU countries only Cyprus, Italy, Malta and Slovakia have higher prices for heavy users of electricity.

    The industry should not suffer, said Grillo, because of “electricity price rises that result clearly from the state support system for renewable energies, and especially photovoltaics.”
    ——————

    1. DirkH

      “Das befürchtete Sterben in der Alubranche beginnt” – “The feared dying in the aluminum sector begins” – 400 workers affected.
      http://nachrichten.rp-online.de/wirtschaft/teurer-strom-alu-huette-voerde-insolvent-1.2819348

      Even the unions say it’s due to the high electricity prices – they don’t even try to blame evil capitalists or banks.

      1. mwhite

        Britain once had two aluminium smelting plants. One has now closed

        http://www.dailypost.co.uk/news/north-wales-news/2009/10/15/dubai-wants-axed-anglesey-aluminium-workers-55578-24936959/

        “AXED aluminium workers on Anglesey are being targeted by a company developing the world’s biggest smelter complex nearly 4,000 miles away in the Middle East.More than 300 workers lost their jobs at Anglesey Aluminium in Holyhead last month when smelting operations were halted over the failure to secure a new power deal.Now the Emirates Aluminium Company, which is building a $5.7bn the giant smelter at Khalifa Port between Dubai and Abu Dhabi, has launched a recruitment campaign to target the redundant workers.They want the workers to help staff the smelter complex where production is set to start in 2010.”

        No carbon dioxide saved there then!

        And the other one?

        http://thegwpf.org/uk-news/4423-green-suicide-the-exodus-begins-.html

        “A plague of profit-busting climate policies is sending a “clear signal” to energy-intensive industries: divest yourself of assets, shed jobs – or just plain ship out.

        Rio Tinto Alcan is closing its Northumberland aluminium smelting plant in north-east England – a direct result of EU climate legislation.”

  6. Bernd Felsche

    Pierre; regarding your grid-unconnected PV system; there are quite a few in my corner of Australia who waited 6 to 9 months before being connected. There was such a rush to the subsidy trough, that the state government programme went 400% over-budget and the grid operator could connect so many variable generators in suburban areas because the infrastructure couldn’t handle the notional peak supply at low demand (around noon, in summer, when people are at work, not in an airconditioned home). Almost all PV solar systems are installed to maximise the harvesting of subsidies.

    The grid had to be upgraded at additional cost because too many permits had been sold. Those upgrades took time. And the electricity bills rose to pay for the upgrades. Those issuing the permits (a QUANGO) didn’t properly track requests.

  7. John Bromhead

    Pierre Gosselin’s 12kW solar system is symptomatic of the problem. You don’t have to think that solar is effective or even fair to other electricity consumers to justify installing it. As I understand it, there has been fierce resistance from some state governments to the German central government’s attempt to slow down the increase in solar capacity.
    In Australia where there is a cooling off about taking costly action to reduce carbon dioxide emissions and more scepticism about CAGW, so far the renewable energy lobby is carrying the day because the penetration of renewables is not great enough to cause real pain in most of the population.
    Anyway you wouldn’t want to get between an Aussie and a free lunch so if Joe Bloggs has subsidised solar why can’t I.

  8. DirkH

    For laughs; NRW just elected a red-green government; Green boss Trittin: “WE want to preserve the aluminium industry.” Headline is “Politik strengthens Alu industry”. From a week ago:
    http://www.ngz-online.de/neuss/nachrichten/politik-staerkt-alu-industrie-1.2828856

    “I’m from the government and I’m here to help you.” Well, the NRW electorate BEGGED for it.

  9. DirkH

    This, BTW, is the breeding ground of Eurocrats:
    http://www.coleurop.be/
    Brugge European College. It breeds 1,600 unelected Eurocrats a year. It doesn’t advertise its services as everyone who wants to make a Eurocrat career must have a degree from them, so demand is high.

    Over 30 years it produces 48,000 Eurocrats which is approximately the Eurocrat population of Brussels.

    1. Bernd Felsche

      Don’t you mean “in-breeding ground”? 😉

      1. DirkH

        I don’t know to which extenct the Eurocrats already form an isolated population.

  10. mwhite

    “France plans to revive EU carbon tariff”

    http://www.guardian.co.uk/environment/2012/may/18/france-eu-carbon-tariff

    “Minister of Industrial Renewal weighs up long-standing idea of carbon tax on goods imported from outside Europe”

    1. DirkH

      Oh look. Founder of Greenpeace arrested in Germany, now free on bail, awaiting possible extradition to Costa Rica.
      http://www.guardian.co.uk/environment/2012/may/18/anti-whaling-activist-paul-watson

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