Here Comes the Sun? Solar Bubbles and Sustainable FITs in Spain | 23 comments (23 topical, editorial, 0 hidden)

Re: Here Comes the Sun? Solar Bubbles... (4.00 / 3)

I'm rather uncomfortable with this account.

The first question to ask is, is the minister of industry an impartial observer?
In particular, why are a 'myriad tiny facilities' a problem, and how do they make the management of the network difficult? This is not substantiated, and it seems the minister is channelling the growls of energy majors.
The Spanish solar bubble of too generous rates has been punctured already, with the rate cut for 2009. If you look closely at the bar graph, you see that solar's big income jump is from 2008 to 2009, which reflects the even bigger jump in new installations in 2008. Thus, solar's current share of the Spanish FIT payout totals is a legacy issue, not an on-going bubble.
There's more to the legacy issue point. In Spain's FIT system, a rate reduction would not affect new installations only, but existing ones too. So, while you think this is about stopping a bubble, the main direct effect would be that existing installations are made unprofitable. And the main indirect effect would be that investors into other FIT-supported generation modes could turn insecure, too.
It's nice to put share of electricity produced and share of FIT support side-by-side, but does it make any sense? Given that there are higher FIT rates for technologies that are currently (and in the recent past) more expensive, it stands to reason that they would get more in total if FIT-supported sub-markets are to grow to the same scale...
In an as yet more limited extent, but with a much better regularity (daily cycles), Jérôme's point about the merit order effect of wind power on electricity prices works for solar, too.
In closing, I note I remember the time when, in Germany, wind, too, was attacked for (a) taking too much FIT money relative to other generating modes, (b) having too generous rates (with focus on small-scale inland projects), (c) making grid operation difficult, (d) making electricity expensive. (This was about five years ago, and the effect was rule changes halving the wind market and boosting the PV, solar-thermal and biofuels sectors.)