German Solar-Power Subsidy Cuts Deal to Be Announced Tomorrow

Germany’s federal government and its 16 states reached a compromise agreement on cuts to solar subsidies in the world’s biggest market.

“There will be an agreement in the arbitration panel meeting tomorrow”, Georg Nuesslein, a spokesman for energy affairs for the CSU, one of Germany’s governing parties, said today by phone from Berlin, declining to give any details of the agreement. The changes will be backdated to April 1.

Chancellor Angela Merkel’s government has pushed to reduce the pace of solar installations by about 50 percent after new projects peaked at 7.5 gigawatts last year, making Germany the world’s top solar market by total capacity installed.

A plan to lower subsidies by as much as 29 percent was blocked by state governors in the upper house of Germany’s parliament last month. They have concerns that subsidy cuts will hurt domestic manufacturers such as Solarworld AG already suffering from Chinese competition.

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