Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

German Wind Sector Blames Solar for Giving Renewable Energy A Bad Name

|Includes:E.ON SE ADR (EONGY), RWEOY

Because the gigantic solar energy boom is driving up the price of electricity, the wind power sector is worried it’s giving the whole renewable energy sector a bad name, reports Der Spiegel.  And it’s threatening to turn into a “civil war” as lobbyists for the wind power sector confront photovoltaic power head-on

“The cause of this clash is the high cost of solar energy in Germany. The more solar cells are connected to the net, the higher the price consumers are forced to pay for electricity. The fear wind power firms have is that this explosion in costs will be blamed on the whole renewable energy sector.”

According to SPIEGEL ONLINE the Bundesverband Windenergie has demanded that the Bundesverband Solarwirtschaft explain how the soaring costs of solar can be capped.  If the solar energy association doesn’t have any proposals, it will have to publicly distance itself from the sector. “This would play into the hands of the four big energy companies Eon, RWE, Vattenfall, and EnBW, which have long said that renewable energy is uneconomic,” writes Der Spiegel.  “On land wind turbines can produce electricity at 5 cents per kilowatthour. Even the best solarmodules produce a kilowatthour for at least 20 cents.  Meanwhile a large nuclear plant can produce at 2 cents per kilowatthour.”

The wind generators criticisms are based in fact: the latest forecasts are that the cost of renewable energy will more than double in 2011 to €15 billion, from €7 billion. According to the renewable energy law, the Erneuerbare Energien Gesetz, these costs will be transferred to consumers.  So the extra eco-supplement consumers pay will double to €170 from €85.

And electricity prices are set to rise further as the €40 billion need to rebuild the grid is passed onto customers.  Photovoltaics are primarily responsible for the rising costs, as generous subsidies fuel a solar boom. Additional solar capacity of 2200 Megawatts had been expected this year. Instead, another 6000 Megawatts has been added.  As a result, consumers are set to receive a back dated bill for this year too.

Der Spiegel believes this will lead to a big debate about the economics of renewable energy: “Solar power generates significantly less energy than wind, but accounts for more than half of the total eco-energy cost. The wind lobbyists say this could be addressed by a reduction in subsidies to the solar sector.”



Disclosure: No positions

Disclosure: No positions
Stocks: EONGY, RWEOY