Germany paid for universal PV R&D Costs

A recent comment on the article… The ANC know exactly what they are doing about energy ?” worth repeating…

Daryl Hunt said…
“Most of my feelings are similar but I would like some clarity on your statement “This is a very intelligent strategy, but it is also one which Italy and Greece followed for the past 20 years!” – intelligent if your aim is a monopoly of all the resources I presume, and not from a member of the public’s point of view? I might have missed some sarcasm there…? Also (and please realise I am not a finance guru) how does a solar system become profitable from day one considering the installation costs, which are generally quite high? I presumed that this was why the REFIT rate for solar PV was so much higher than the other RE technologies. 

Thanks for a great article!”

David Lipschitz replied….

I say intelligent because Italy created a similar strategy to Germany in the early 1990’s related to Feed In Tariffs. At that time, Germany, and especially Dr Hermann Scheer, realised that energy costs would rocket by 2020. At that time grid tie electricity from PV was over R11 per kWh. Dr Scheer and the other members of the German government had two options, FITs and Tenders. They chose FITs as they wanted to create a decentralised electricity grid where the end user takes as much responsibility for his energy provision as he can.

Tenders favour the big guys and are controlled by the utilities. In Italy’s case, Italy had a monopoly called Enel. In South Africa’s case, South Africa has a monopoly called Eskom. Germany didn’t have a monopoly. FITs worked in Germany.

South Africa “introduced FITs” in 2009, but made them impossible to get by not having a PPA (power purchase agreement). And then in 2011, the ANC declared FITs illegal and went over to the British Tender System. Interesting as two years ago Britain declared that the Tender system had failed and moved to the FIT system.

Greece’s problem, like Syria, and over 40 other countries, is that they need to import all their energy resources and that these imports are more than their total export earnings. So their economies aren’t viable; Their economies are depressed; and there are daily riots and other problems as more and more youth are unemployed.

We also have over 50% youth unemployment here, but fortunately we still have a very good grant system and many very poor taxpayers. And so the ANC needs to keep selling pieces of South Africa to keep money pouring into pay grants. Not a good long term strategy.

A monopoly’s aim is to keep itself as a monopoly. It doesn’t care about anything else. It should be re-orientating itself, but it isn’t and it is causing the death not only of itself, but also of South Africa.

Please see for my Grid Parity graph and then read which explains why we can produce electricity using PV cheaper than we can buy it.

The German REFIT has helped bring the price of PV from R11 per kWh in 1991 to under R1.50 per kWh today. For your interest, one watt of PV cost R50,000 in 1950. Today it is close to R15 per watt. Helped substantially by REFITs and the Computer and Electronics Markets.

In essence, Germany has paid the R&D costs for PV for the entire world and now the entire world can benefit in this technology. Of-course at the same time Germany has created a huge industry and international market for its Renewable Energy Goods and Services and we should support them as best we can to help Germany recover its investment. At the same time we should help ourselves not to be dependent on others for our energy needs.

The only way we can do this is with renewable energy.

Please donate to the SAAEA today to help us with our ongoing R&D and costs involved in keeping you informed of RE’s possibilities.

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