Those who are interested in solar power will certainly be looking for subsidies, grants, feed-in tariffs and other governmental support that bring the cost of installing solar power down.
Homeowners are already benefiting from lucrative subsidies in some countries. This has been triggered through growing global pressures over the concern of limited fossil fuels. Consequently, nations have been encouraged to offer solar subsidies to assure future energy independence.
The main types of government support for solar energy in leading countries are in the forms of Feed-in tariff, tax credits and green loans.
In Germany
In Germany, the renewable Energy Sources Act (EEG) has assured a stable price for electricity provided via green energy for two decades. This has definitely supported households as well as business to install photovoltaic (PV) panels, and thereafter sell this solar electricity to the national grid.
However, during 2009 the cost of PV has significantly decreased. The government has thus equally contracted the tariff rates offered. According to the most recent figures in July 2010, the guaranteed feed-in tariffs were between 24 to 33 euro cents per KWh for ground mounted systems and rooftop solar photovoltaics.
The state has already announced that these rates will be cut by roughly 11 to 16 percent in September 2010. So, the faster ones install photovoltaic panels the quicker is one to assure a return on investment over the coming two decades.
Large scale commercial systems are given tax credits, which means that they might benefit from VAT exemption.
In Germany, there are also green loans, provided to both private and commercial investors. Private investors can benefit from 100 percent interest free loans, while commercial investors are provided 50 percent redemption on interest rates for several years.
More Information can be gleaned from Germany’s Ministry of the Environment
In Spain
Spain is well-known as a leader in solar energy. Their expansion in solar energy has been mostly because of the Feed-in Tariff. However, during the recent years, capacity caps have been set on the feed-in tariffs. The caps were introduced in 2007 after an over-inflated expansion. The tariff scheme was reduced for photovoltaic solar cells from 45 euros to 28 and 34 euro cents per kWh for the next 25 years.
The tariffs vary according to quarterly demands. For instance, if 75 percent of the cap for the previous quarter is matched, then the tariff will decrease by up to a top of 2.5 percent while the cap will also increase with the same percentage. On the other hand, when less than 50 % of the caps is attained the guaranteed electricity price will increase, and the caps will be reduced by an equivalent amount.
The tax rebates for solar PV were relatively low in 2009. A rebate of 4 percent was offered yet it has further dropped by 50 percent to only 2 percent, in 2010.
Spain did also introduce building standards in 2006 for solar PV as well as types of solar hot water systems.
For information related to selling electricity please go to: national Energy Commission (CNE)
In Japan
There are renewable obligations in Japan. There are laws forcing electric utilities to provide a percentage of their electricity needs from alternative sources of energy. This amount is gradually augmented every year. The surplus power generated through photovoltaic systems is bought by utility companies at a price of 48 yen (48 euro cents) for a KWh. The price of 48 yen for a KWh is tantamount to 100 percent more than the current electric price (2010).
There are also subsidies and tax breaks offered for solar power systems. This is provided to private, commercial, educational institutions and even governmental buildings. A subsidy of 70,000 yen is offered for residential systems per kilowatts up to a maximum of 10 KWh (roughly 625 Euros). However, some domestic governments provide even more as in Tokyo city, where 100,000 yen per KW of solar capacity has been offered as per 2010.
More information can be found on Japan Photovoltaic Expansion Center (in Japanese use Google translator to change language)
The United States Federal Government
The Obama administration’s early economic stimulus package has provided renewable energy grants. It provides with up to 10 to 30 percent grants for clean energy projects. The cash grant is provided to solar energy project that has been operational since 2009 or 2010. The cash grants are even available for projects that have initiated their construction in either 2009 or 2010 and are due to be delivering energy by 2017.
The Loan guarantee program (LGP) provided by the U.S Energy Department is meant for large scale green energy projects. Recently, Abengoa Solar, a Spanish company was provided with $1.45 billion in loan guarantee to establish the Solana solar plant with capacity of 250 MW in Arizona.
There have also been several federal tax credits offered, for example, for the Nevada Solar One power Plant installation a total of 30 percent tax credit was offered. Typical households can also apply for a 30 percent tax credit but up to a maximum of $1500.
Information regarding can be found here: Energy Policies by U.S Department of Energy
The United States – State Governments –
There are several U.S states that have established high renewable energy targets. For example, in Nevada, which has one of the largest solar power plants, their aim is to produce 20 percent of energy from alternative sources of energy by 2015.
In one of the greenest states, California, there is a solar photovoltaic rebate program known as New Solar Homes Partnership. The whole rebate program consists of $400 million devised for the setting up of solar PV on new households. There are also subsidies provided for solar water heating systems in California.
For more information please go to: a database of States Incentive for Renewables & Efficiency
In Italy
The Italian feed-in tariff is roughly between 35 to 39 euro cents per KWh for typical rooftop PV. However, for ground-bases solar panel systems inculcated into buildings the feed-in tariff is 49 euro cents per KWh for a warrant period of 20 years.
These rates are unfortunately going to be cut by 30 percent as of 2011. This will apply for installation systems with a capacity higher than 5 MW while for smaller projects the cut will be only 20 percent. The decrease in the feed-in tariff will constantly continue in 2012 and 2013 by 6 percent respectively.
The financial incentive will also only cover a maximum of 3000 MW for typical photovoltaic capacity. Yet, for smaller projects such as 200 to 300 MW of concentrated solar power or innovative solar technology there will be other types of incentives.
There are also tax credits offered in Italy. An exemption of 20 to 10 percent of VAT is offered on the cost of solar power equipment as well as installation. In other words, a maximum decrease of property tax of 36 percent can be achieved by installing solar power.
In South Korea
There is a feed-in tariff provided at a rate of 33 to 37 euro cents for renewable energy projects of less than 30 KW (33 cents) and for 1 MW (37 cents) capacity project and above.
In 2009 South Korea had a tax credit in the form of slashing import duties on imported renewable energy equipment. The aim was to decrease the cost of installing renewable technology.
The current 100,000-rooftop program (subsidy) is also expected to contribute with 300 MW of solar energy by 2011. The state is providing with as much as 70 percent of the installation cost, meaning that homeowners pay roughly 30 percent of the current capital cost.
The Korean government has also been introducing building standards, in 2010. Renewable energy is expected to contribute to an approximate to 5 percent of the total energy requirements for public buildings of 1,000 square meters or more.
In France
A two decade feed-in tariff is offered for both ground-mounted and rooftop solar PV systems. A guaranteed rate of 31 cents per KWh is provided. However, for solar panels that are inculcated into hospitals, schools, residential-buildings benefits from a feed-in tariff of 58 cents per KWh. Industrial sites as well as offices receive a price of 42 to 50 cents per KWh depending on scale and nature of technology used.
For solar materials homeowners can benefit from a tax rebate of as much as 50 percent up to a top of 8000 Euros per person. This means that a couple can benefit from 16,000 Euros, this rebate has been valid since 2005 and will last to 2012. In addition, if the property is older than two years then there will be a VAT reduction for material installation cost from 19.6 to 5.5 percents.
The government does also provide subsidies for green loans. The rates for green loans are between 3 to 5 percent depending on institutions for a period of 5 to 10 years.
In the United Kingdom
In April 2010, a 25 year guaranteed feed-in tariff was introduced at a price of 32.3 euro cent per KWh especially for standalone solar systems feeding in energy into the grid. However, systems that are integrated into buildings will be provided with 45.6 euro cent per KWh. There has also been certain renewable energy obligations set for electricity suppliers. They are expected to increase the percentage of energy provided by clean energy sources each year up to 2037.
In China
It is not fully clear how the conditions are for feed-in tariffs in China, but people benefit from 21 euro cents for typical ground based systems and 36 euro cents for rooftop systems.
The Chinese government is more focused on providing subsidies. For large solar PV buildings generating more than 50 KW as well as on-grid projects that contribute with above 300 KW, a 50 percent subsidy on capital costs is provided. There are also off-grid projects that benefit from subsidies of 70 percent of the total start-up cost. The aim of the local governments is to provide subsidies to encourage the erection of solar PV in rural and remote areas thus assuring electricity supply to all its citizens.
More Information Concerning Chinese Energy Policies:
In India
One of the largest energy visions is shared by Indian Citizens. The Jawaharlal Nehru National Solar Mission project aims at supplementing up to 20 GW of solar energy by 2022. The prime phase of the project is to establish off-grid solar PV as well as solar thermal by 2013.
A feed-in tariff system for 25 years has been implemented. For 2010 to 2011a tariff of 5.5 rupees which is equal to 0.09 euro cents is enforced. This feed-in tariff will rise by 3 percent every consecutive year.
There are other schemes expected to be incorporated into the law. There is a strong support for providing 30 percent subsidy as well as interest bearing loans of 5 percent for solar energy projects. Furthermore, remote, border regions and mountainous areas where electricity is a bit scarce would be provided a subsidy matching up to 90 percent of total costs.
Information Concerning Renewable Energy in India can be found here: Indian Renewable Energy Development Agency and Ministry of New and Renewable Energy
Jimmy Eriksson is a content writer for Online Schools and Online MBA who gives advice on the pursuit of education and living a healthy life. He also is a contributing writer for a site that helps students determine the best online nursing programs for them. In his free time he enjoys researching on renewable energy, healthy living, management and leisure’s such as fishing and swimming.
Main Source: Allianze
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