All the green jobs of the future that were promised – have now turned into dashed dreams. On the scrap heap along with the promises of communism, redistribution, third ways, etc.
FOCUS magazine here brings us up-to-speed on the trials and misery of Germany’s much maligned solar industry. The situation is worse than we thought.
It’s in a rapid death spiral, and it has claimed its latest victim: Solarhybrid AG. Last Tuesday evening, just a few dozen months after the company went public in 2008 amid the usual hoopla, it announced that it is bankrupt and is now seeking protection from its creditors. The sunny days are gone.
Solarhybrid’s collapse follows on the heels of Solon and Solar Millennium, who also recently went bust. The great German solar energy bubble has popped. With the current feed-in rates ending on April 1st, set to drop another 20%, the real monster crash still remains to come.
Solarhybrid was a specialist for large solar power plants, and was even optimistic about the future just as recently as October 2011. I bet the investors who jumped on board in October are really amused.
The German solar industry suffers from severe global over-capacity and falling government subsides, without which they can’t compete. Yet it should not be a surprise that it has come to this. Half of the world’s solar power generation capacity is installed in Germany, a country that gets as much sunshine as Alaska. It was only a matter of time before the reality of economics caught up. So far Germany has committed over €100 billion in solar subsidies over the next 20 years – for a power source that will hardly make a dent.
Other German solar companies such as giants Conergy und Q-Cells are beginning their death throes. Even once bullish Solarworld director Frank Asbeck, the die-hard optimist of the industry, is warning of really tough times ahead (emphasis added):
If the subsidy reductions continue, the entire branch will be forced to sell its products below cost. We can’t take this very long,’ he said Tuesday regarding the solar subsidy reductions. In the entire branch there is not a single company that is in the black. The same is true for Chinese manufacturers.”
If that doesn’t sound awful enough, then read what Klaus-Dieter Maubach, Technology Chairman at power giant Eon, is quoted as saying to Bloomberg (emphasis added):
In view of the competition from China, Germany’s solar industry will disappear completely within 5 years. Not a single employee will be working for a German solar company, because by then they will all have gone bankrupt.”
16 responses to “Germany Singing A Requiem For Its Solar Industry – “Not A Single Company In The Black….Industry Will Disappear Within 5 Years””
[…] and Solar generation WILL end in a disaster. That’s guaranteed! It’s already happening in Germany but hey!……..McGuinty won’t look in that direction ion case his little green […]
Just like any other industry.
I assume you are some kind of paid distributor of propaganda… because it is really not that difficult to see that renewable energy is going to be the main worldwide economic force for the next 40 years… and every government of every country, state, providence and city on the planet are positioning to ride that wave. The industry is growing exponentially, and in just a few more years it will cross the tipping point. You can’t stop it.”
You assume a lot of things. Now we await data from you supporting these assumptions. Good luck finding it! We won’t hold our breath.
“Worldwide economic force”? Yeah right – the collapse of it is proof…just like a cold globe proves warming.
alf, if the current price curve continues new PV without storage will produce electricity in a cost effective way (for a price of about 5Eurocent/kWh) in 2020. A few years after that, maybe in 2025, storage will be cost-effective (I just assume that storage doubles the cost, and that the generation cost halfs within 5 years; and that the simplest means of mass storage is Methane synthesis).
This will be too late for most, maybe all, of the current solar companies in Germany. They got accustomed to a high level of subsidation and did not use their money to adapt to the inevitable decline in prices, and used their money for lobbying for more money. They have deserved to die.
And when solar power does not need to be kept alive with constant subsidy infusions, we will surely be the last to be against it. We’re free marketeers here.
Here’s an interesting comment, and some price data up to 2009.
“In his article in Scientific American, Naam wrote “The National Renewable Energy Laboratory of the U.S. Department of Energy has watched solar photovoltaic price trends since 1980. They’ve seen the price per Watt of solar modules (not counting installation) drop from $22 dollars in 1980 down to under $3 today [in 2009].””
It’s clearly an exponential; call it a corrolary to Moore’s Law, call it Kurzweil’s Law of Accelerating Returns, whatever. In the face of the clear predictability of the break-even point, it was complete madness by the economically inept Red-Green government of Schröder to create this 16 billion a year subsidy hole; from the start. You try to rush an exponential law dictated and controlled by the market forces – you lose; and create misery for everyone. The eternal failure of price-fixing.
Alf, you’ve got to help me out here. After reading the article, upon what do you base your optimism? This same sad story about solar energy in Germany is being played out in Spain, Canada, the US, etc, etc. Please provide just one….not a hundred….just one study/article/story demonstrating a profitable large solar farm that is not dependent on tax payer subsidies.
I use wind and solar on my sailboat because it is economically feasible. I’m confident that a vast percentage of the world population are in favor of renewable energy. When such energy sources are put into application coupled with being economically competitive with carbon based fuels who would reasonably stand in the way. Big oil? I don’t think so…they are already big investors in renewable energy and are in an established marketing position to offer/distribute alternative new sources of energy to the public. So who else do you have in mind that is against renewables? If it/when it becomes profitable what fool would stand in the way of saving themselves money utilizing something more economical than carbon based fuels?
Just be patient and let the market work. No need to become emotional (“propaganda”!?!)….like every other product before, new sources of energy are first and foremost all about economic feasability. Until that important criteria is met we will continue to see more and more stories like the above, regardless of any emotionally implied charges of “propaganda”.
The Chinese produce their PV modules with the exact same machinery as the German companies; Centrotherm and Roth&Rau machines (from Germany). Their decisive cost advantage is cheap energy – wages in the German PV module manufacturers are so low and automation so high that that is not the decisive difference.
PV manufacturing has never paid well for the workers in Germany so that’s not a loss, they only needed low skilled workers due to the high automation; after taxes it barely paid more than Hartz IV to have a full time job there…
Most of their profits the solar companies invested into lobbying Brussels. Killing this leeching industry is some good news for the return of sanity. Hope they don’t waste even more money with offshore wind and electric vehicles. Would love to see the entire EU commission replaced with sane people… and this green poet king of the EU, Van Rompuy…
Schellnhuber from PIKE was on German radio this morning talking about Rio+20
We already have a weak solar maximum…
Much less of those pesky spots, so: more sunlight. And if those academic boffins are right & the spots disappear altogether over the next few solar cycles, that means even more sunlight. (And if it really gets cold, there will be no weeds covering our shiny panels for those sceptics to sneer at…)
“Industry Will Disappear Within 5 Years”
This is a real reason for Poland’s voting against European craziness from Brussels. Our cement and fertilizer factories will disappear too.
Perhaps the energy costs are still too low in Poland, but we earn a quarter of that what you may earn in Germany!!!
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Yeah, considering energy-intensive industries Poland was right opposing the set-aside of CO2 allowances at the last European Council. In Poland there is still green certificates support scheme instead of feed-in tariff
This is much less flexible instrument and when it comes to facts it supports outdated technologies
[…] I just happened on another blog posting that used the exact same “death spiral” reference. Unfortunately for the blog’s […]
Once a politician has ‘bought’ into something and pledged himself to its success there’s no going back. Tis better that everything and everyone be destroyed rather than to admit the mistake and stop the stupidity. Courage among politicians is a very rare comodity, so why do the people keep voting the same cowards into office? Are the people stupid and just as guilty? Would seem so.