INDUSTRYPOLICY
a catastrophe and underscores the risk associated with a global market dependent on one nation’s political consensus.
“The possibility of a market cap in Germany in 2012 arises from the “Experience Report EEG”, scheduled for publication in mid-2011. Based upon market developments in 2010, it will contain recommendations for the EEG amendment which will come into affect on January 2012. According to Markus Hoehner, CEO of EuPD Research, “It has to be assumed that the strong market in 2010 and 2011 will lead to either a greater reduction in FIT or, even worse, a market cap.”.
These emerging global forces have profound implications for European economic health and require updated energy policies to achieve maximum economic benefit for European member states, citizens and companies. The SEMI PV Group advocates for effective public policies that support the growth of the global solar industry.
Fortify R&D
European policymakers need innovative programs that seek to balance PV demand with supply, and in particular, R&D policies that retain and grow the manufacturing base. According to the European Commission on Energy “Innovation remains critical and must be given even higher priority. R&D spending in Europe is below 2%, compared to 2.6% in the US and 3.4% in Japan, mainly as a result of lower levels of private investment. Europe needs to focus on the impact and composition of research spending and to improve the conditions for private investments. The challenge for policy delivery is to ensure that available funds are invested in the sort of projects and initiatives which will contribute most to achieving the energy policy
objectives.” Read Towards a new Energy Strategy for Europe 2011-2020 by European Commission on Energy. PV products are dependent on the continuous improvement of manufacturing process technology and require the close coupling of R&D and manufacturing. Long-term market success is increasingly defined by the ability to go “from lab to fab.”
Loss of the manufacturing base due to poor financial incentives, lack of financing and other policies that discourage plant locations and upgrades in Europe will create powerful opportunities for R&D and manufacturing to flourish outside of Europe.
A level playing field
The gap between European PV supply and demand needs to be addressed with public policies that enable European manufacturers of solar power to compete more effectively in both European and global markets. Trade restrictions and reprisals against non-European manufacturers are not the answer and will ultimately harm European manufacturing and global environmental goals. The solution lies in recognizing the unique needs and important economic benefits of manufacturing and crafting sound policies that retain and grow the PV supply in Europe.
Europe’s leadership is undeniable but policy changes must be made. Supportive feed-in tariff, grid connection, and other policies on the demand side are essential to help transform our fossil fuel- based economy. Additional renewable energy policies in tax, regulation, financing and R&D support are necessary to ensure that Europe benefits in the coming years. Feed-in tariffs are created to step down and eventually disappear.
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www.solar-pv-management.com Issue III 2011
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