The Birth of a Power Source

OXFORD – Germany has just crossed the threshold of 20% renewable power – honoring its 2020 commitment to the European Union eight years ahead of schedule. As a bonus, towards the end of the decade, the world will also thank Germany for affordable solar power – not because the technology was invented there, but because its citizens will have paid for the critical cost-reduction phase by offering a large market.

Germany’s decade-long support of the rollout of solar photovoltaic (PV) technology has forced the technology down the cost curve at an accelerated rate. Before 2015, it will be fully commercial for sunny South Africa, Greece, or Mexico – and soon thereafter for Germany itself. Without Germany’s energy policy, this reduction in costs would have taken far longer to achieve.

But German policy is not simply a matter of altruism. It is a combination of sound industrial policy and acceptance of the responsibility to shoulder Germany’s share of the EU 2050 carbon reduction goals.

The story is sometimes told as follows: “Germany has subsidized solar PV for years through artificially high feed-in tariffs. The result has been lots of solar panels – many of them imported from China – in a country with little sun, and 100,000 expensive jobs.”