German government to cut back renewable heating support scheme

In Germany and beyond, the ban of further support payments will endanger many industry players and investments of the past few years that amount to several billion Euros.

Brussels, 17 May 2010 - The German ministry for environmental affairs announced last week an immediate ban on further support payments under the federal incentive scheme for solar heating, biomass and heat pump installations. ESTIF heavily criticizes this decision which hits the solar thermal industry without warning and puts the whole renewable heating sector in danger. This measure is based officially on a budget freeze that the German federal parliament put in place.


In Germany and beyond, the ban of further support payments will endanger many industry players and investments of the past few years that amount to several billion Euros. The upshot is that most of the manufacturers concerned have already received order cancellations; they will have to restructure their business lines, scale down production and consider a reduction in workforce. Many smaller companies that have specialized and now depend on demand for single components may even be forced to file for bankruptcy.

"The measure will also lead to a structural weakness in the solar thermal market", says ESTIF's President Oliver Drücke, "as customer demand is likely to fall at short notice but needs, as experience demonstrates, years to rebuild. With Germany representing 38% of the European market, the decision's ramifications will reach well beyond Germany."

The German solar industry association (BSW-Solar) also strongly objects the unprecedented decision, arguing that under the present support scheme (the so-called "Marktanreizprogramm") each Euro invested in solar thermal triggered 8 Euros of subsequent investments. With the government support scheme being a key driver of the private customer demand for solar thermal installations, the future development of technology at more competitive prices is made difficult, if not impossible.

According to Carsten Körnig, CEO of the German solar industry association, it is therefore "more than uncertain whether the ambitious goal of an 18% share of renewable energy in the overall energy mix in Germany can be reached by 2020 without the full contribution of renewable heating and cooling."

For the above reasons we ask the German parliament to lift the budget freeze immediately as far as it blocks investments in solar thermal installations. ESTIF, the voice of solar thermal in Europe, requests the political decision-makers to maintain supportive framework conditions once they have been successfully set up so to ensure the positive investment climate and sustainable framework conditions for the solar thermal sector in Europe.

For more information, please visit: www.estif.org or contact us at the address below.

European Solar Thermal Industry Federation (ESTIF)
Rue d'Arlon 63-67
B-1040 Brussels
Tel: +32 2 546 19 89
Fax: +32 2 546 19 39
Email: celia.galeotti@estif.org
Website: www.estif.org


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