Whoa

 Illustration of Haitz's law. Light output per LED as a function

of time, note the logarithmic scale on the vertical axis.



 "And in one possible indication of the acceleration of green growth, high-efficiency LED (Light-Emitting Diode) ceiling lamps in the Japanese household market went from 2.2 percent of sales in February 2011 to 57.7 percent this May."

A Crossroads for Japan: Rivive Nuclear or Go  Green?

The SEIA on Tariffs

TMI

This article notes the SEIA has recently taken a non-neutral position regarding the AD/CVD case against Chinese solar cells. Personally, I think the SEIA should have taken a stand back in October rather than doublespeaking themselves out of a situation they should have been directly involved in. That said, it's good to see the SEIA finally waking up to the fact that the industry they represent is overwhelmingly against imposing these boneheaded tariffs. Maybe the SEIA has figured out that this CASM sideshow diverts attention away from much more important matters like, for example, driving down system costs in step with subsidy phaseouts. Maybe, just maybe, the SEIA reacognizes this detour is taking the industry in the wrong direction. It would be nice if the SEIA followed up  this non-neutral AD/CVD position by taking a more progressive stance on several other issues facing the industry such as tax fraud, sustainable deployment policies, etc. It should be clear that status quo strategies will not take this industry into the future.

The SEIA would do well to look up and learn from the history of the Institute of Nuclear Power Operations (INPO). INPO was formed in the aftermath of Three Mile Island. INPO is composed of experienced members from the nuclear community whose mission it is to identify and promote industry best practices. It would be nice if the SEIA stepped up efforts to proactively steward the industry before, rather than after, a TMI type event occurs.

Vocabulary

Experts inspecting the Rosetta Stone during the Second

International Congress of Orientalists, 1874

Loaded Solar: A photoelectric project or system that uses some or all of its generation to serve on-site load.

Unloaded Solar: A photoelectric project or system that feeds all generation into the grid.

Hydel: Shorthand for hydroelectricity

Photel: Shorthand for photoelectricity

Everybody Loves Cartoons

Dear IRS... What are your thoughts on depreciation?

Paying the Tax (The Tax Collector), Circa 1640

Dear IRS

In Germany if you install a solar power system you automatically become a small business that sells electricity back to the grid. As small solar businesses, German home owners with PV systems are allowed to depreciate those systems using a linear and or declining balance schedule. I am curious why home owners in the US are not allowed to depreciate their solar power systems? The rule says:

"This property (depreciable property) is generally limited to tangible, depreciable, personal property which is acquired by purchase for use in the active conduct of a trade or business. "

When you install a solar power system you are involved in the active conduct of trade with the electricity grid. Note also that you are trading electricity with entities that are capable of depreciating their generating stations. Does the IRS intend to classify residential solar power systems as a depreciable asset? If so, what's the time frame? If not, why not?

Respectfully,
Photomofo


Dear Photomofo

Thank you for your questions, whether when you install a solar power system you are involved in the active conduct of trade with the electricity grid, therefore the residential solar power system would become a depreciable asset.

There is no provision in the U.S. Internal Revenue Code (enacted by the U.S. Congress), that if you install a solar power system you automatically become a small business because you sell electricity back to the grid.

Per Publication 334, Tax Guide for Small Business:

Trade or business. A trade or business is generally an activity carried on to make a profit. The facts and circumstances of each case determine whether or not an activity is a trade or business. You do not need to actually make a profit to be in a trade or business as long as you have a profit motive. You do need to make ongoing efforts to further the interests of your business.

You do not have to carry on regular full-time business activities to be self-employed. Having a part-time business in addition to your regular job or business may be self-employment.

Per Publication 535, Business Expenses:

In determining whether you are carrying on an activity for profit, several factors are taken into account. No one factor alone is decisive. Among the factors to consider are whether:

-You carry on the activity in a businesslike manner,
-The time and effort you put into the activity indicate you intend to make it profitable,
-You depend on the income for your livelihood,
-Your losses are due to circumstances beyond your control (or are normal in the start-up phase of your type of business),
-You change your methods of operation in an attempt to improve profitability,
-You (or your advisors) have the knowledge needed to carry on the activity as a successful business,
-You were successful in making a profit in similar activities in the past,
-The activity makes a profit in some years, and
-You can expect to make a future profit from the appreciation of the assets used in the activity.

Based on the above rules, the taxpayer would have to be in a trade or business of generating and selling electricity, to be able to depreciate the residential solar power systems.

If you are in the trade or business of generating and selling electricity, you could only depreciate the portion of the solar system that is used in that trade or business. The part of the solar system that is used for your home would be considered personal use and not depreciable.

*Underlined by Yours Truly

Dismantling Net Metering and Building the Future

Sortie de l'opera en l'an 2000... A look from 1884 at Parisian
travel IN THE YEAR 2000

If Net-Metering is a net benefit to the ratepayers why would solar advocacy groups such as Vote Solar want to maintain the status quo? These groups should be arguing for a full valuation of solar. At some point you have to admit that net-metering a temporary fix and stop moving sideways. Onwards and upwards are better directions.

Here's a revenue neutral way to dismantle net-metering and replace it with a market based system. 

• Step 1. List all the things that photoelectrics provide the system and then rank these benefits in order of easiest to quantify.
• Step 2. Do a study and come up with a rigorous methodology for valuing this benefit.
• Step 3. Lobby the PUC to have this value get paid out with a monthly check.
• Step 4. Reduce net-metering payments by an amount equal to the the benefit calculated in step 3.
• Step 5. Go down the list prepared in Step 1.

Example:

• Step 1. A study determines that the energy value of photoelectricity is the easiest to quantify.
• Step 2. A value of 5 cents per kWh is determined for the energy value.
• Step 3. The owner of a 20 kW system which exports 1,000 kWh a month starts getting a check for $50.
• Step 4. Instead of getting the full retail value the 1,000 kWh that's exported the net-metering payment is reduced by 5 cents per kWh. This means the solar system owner gets $50 less per month for her electricity.
• Step 5. Repeat...
• Step 1. Experts conclude the capacity value of PV is the next easiest to quantify.
• Step 2. A value of $20 per kW year is determined. 
• Step 3. The 20 kW system would be paid $35 per month in capacity payments - ($20/kW x 20 kW)/12 months
• Step 4. The solar system owner gets paid $35 less per month for her electricity.
• Step 5. And so on with quantifying the value of reduced losses, avoided transmission costs et cetera.

At the end of this procedure net-metering has been completely dismantled and replaced by a market regulated pricing mechanism. This procedure is specifically designed to be revenue neutral but it's not completely so. There are several factors which throw off neutrality. First off, taxes must be paid on the revenues from the sales of photoelectricity. Secondly, this system allows residential photoelectric system owners the ability to depreciate their systems. Here's a rough example of how the math works out comparing taxes to depreciation.

Assumptions:

Tax rate = 30%

Cost per KW = $3000/kW

Export volume =  800 kWh/year

Export rate = 10 cents/kWh

Taxes = Export volume x Export rate x Tax rate = 800 x .10 x .30 = $24/year

10 year Linear Depreciation Benefit = Cost per kW divided by 10 years x Tax rate = 3000/10*.30 = $90/year 

Net benefit of $66 per KW. If you have a 5 kW system that's $330. For this kinda money people are going to buy the Solar Edition of Turbo Tax.

Load: A Rough Cut Sprinkled with Secret Sauce

If you're a utility manager, you want the load to be as consistent and as close and safely possible to capacity throughout the day and the year. The most picturesque example of this phenomenon comes from the early days of electricty. Back then, electric trolleys fromed the dominant load, so companies built amusement parks at the ends of their lines to suck up nighttime load and also generate some extra traffic and revenue. This "load balancing" brought us Coney Island. By 1901 more than half of trolley companies operated at least one park with rollercoasters or underground tours or other rides.

-Alexis Madrigal, Powering the Dream

Load in 60 seconds

•  Load profiles are shaped like a wave with a peak during the day, an off-peak period at night (AKA: trough) and shoulder periods connecting peaks and valleys
• Weekends and holidays generally have lower peaks than adjacent weekdays due to less commercial and industrial activity
• Hot climates peak in the summer. The hottest days have the highest peaks due to A/C load.
• Cold climates peak in the winter. The winter peak is driven by heating loads.
• Load drives the price of electricity up
• Supply drives the price of electricity down.

Supply vs. Load vs. Price

The graphic to the right is a supply side depiction of several solar penetration scenarios for California. For my purposes nuclear, coal, wind and geothermal power plants can be disregarded because they remain unchanged in all scenarios. The generators to take note of here are the load followed resources. These being imports, combined cycles turbines, hydro, pumped storage and gas turbines.

In the Base Case all the load following plants follow the same basic pattern - they ramp up in the morning, peak during the day and ramp down in the evening. If you look carefully you can see that as the solar penetration increases the peaks progressively flatten and eventually divide into two peaks - a minor morning peak and a major evening peak. We can also see that the load following plants are all shifted from the middle of the load curve to the right of the curve as the solar penetration increases. For reasons unknown this graphic assumes a fixed load curve for each penetration scenario. This flawed assumption limits the usefulness of this graphic.

An improved graphic would incorporate the fact that solar power drives the price of wholesale electricity down. Electricity isn't known to be all that responsive to prices but there are price responsive customers - these customers would undoubtedly shift their loads around to capture cheaper electricity if they could. An improved graphic would show the load curves reaching incrementally higher peaks and lower troughs with increasing solar penetration.

I'm not going to say I've got it all figured out. Things get really unpredictable really fast. Here's a sketch of some possibilities.

Now: Natural gas peaker plants (AKA: Combustion Turbines or CTs) are currently used to meet peak load.
Next: Photoelectric plants easily cover peak load. CTs go the way of the dinosaur.
Now: Prices peak during the day and bottom out at night.
Next: Prices will flatten during the day and drift up marginally at night. The price peaks will occur at the load shoulders.
Now: Pumped hydro reservoirs fill in the middle of the night and run at the peak.
Next: Reservoirs will fill up at night and run in the morning shoulder then fill up in the middle of the day to run during the evening shoulder.
Now: Base load is approximately half of Peak load
Next: Base loads are going to shrink and Peak loads are going to rise.
Now: Demand Side Management (DSM) programs offer cheap rates to customers who move loads from peak load hours to off-peak hours.
Next: We should see DSM programs adjusted so that the cheapest rates occur during the day. This will move flexible loads (irrigation pumps for example) out of the off-peak load hours and into the peak load hours.
Now: EV buffs imagine these cars charging at night.
Next: EVs charging strategies will be designed to avoid the shoulders - day or night should be fine. You'll aim for the weekends if you can.
Now: People think photoelectrics need storage
Next: People recognize that all the displaced natural gas, hydro and imports will be available to provide back up. People also recognize that photoelectrics mathed to load behaves like a firm product

Germany is already seeing some of this stuff happen. For example, they are seeing lower daytime wholesale prices and higher prices at night. They are seeing double cycles of their pumped hydro plants and they are also seeing the disappearance of CTs. Consider that this is all happening at relatively low penetrations of solar (approximately 4 to 5%) and despite the unexpected decommisioning of six nuclear reactors following the Fukushima Daiichi nuclear disaster. Had those plants been up and running this past year we would have seen even more pronounced daytime price depressions due to excess power supply and even more peaker plants decommisioned due to poor economics.

SEE: Power too cheap for new gas turbines in Germany

To be continued...

 

Installed Costs in Germany Continue Descent

Mid-quarter price update from BSW indicates average installation costs have fallen to 1776 Euro/kWp. And the beat goes on... the beat goes on...Drums keep pounding a rhythm to the brain... la dee da dee dee... la dee da dee die

Pasts and Futures

Past

Back in August of 2009, Paula Mints predicted a high side 2010 PV market of 7.5 GW. The 2010 market ended up at 18.2 GW. Paula's high side estimate for 2011 was 10.8 GW. The 2011 market ended up at 30 GW. 

When an expert is this wrong about growth it tells you how extremely difficulty predicting growth is. 

P.S. Paulas' estimates for 2012/2013 are 14.4/21.4 GW. Extrapolating the 2010/2011 error trend suggests  2012/2013 totals of 38/48 GW.

More Past

Here are some predictions from a presentation given by Dr. Charlie Gay in April of 2010. The article also contains a graphic that compares several scenarios with natural gas at various prices - $6/MMBTU up to $14/MMBTU. If the graphic had used current prices of $2.5/MMBTU things would look a little different.

Off topic but a very interesting quote:

A utility in China is very different than a utility in the U.S. so those utilities are able to bring the market along with the manufacturing. Many of them today make their own aluminum, for example, as part of how they do load leveling. Rather than worrying about pumping water uphill for storage, they use that nighttime power to create other products.

Some Future

This report will probably egregiously misunderestimate the next few years of growth but it's got some great data in it.

Global Market Outlook for Photovoltaics until 2016

Bad Company - Great Commercials

I found these videos here. Note the yahoos in the comments section. What a bunch of goofballs.

Imp Ire Strikes Back

The contract states
That on these dates
You'll pay us fair and square


But here today
We get half pay
Plus cuts to our healthcare


 Ching Ching... Chang Chang...
Ching Ching... Chang Chang..


We want what's our White Hair


Ching Ching... Chang Chang...
Ching Ching... Chang Chang.. 


Don't try us, don't you dare!


It's not as though
I chose this road
Free trade was forced upon me


We must cut costs
Or all is lost
You know I would not con thee


 Ching Ching... Chang Chang..
 Ching Ching... Chang Chang..


Make knicks and knacks cheap cheap


 Ching Ching... Chang Chang..
 Ching Ching... Chang Chang..


Hi Ho Hi Ho compete!

I woke up to a surprise in my inbox today. 


Photomofo,


Would love to help with your wish list but am dealing with an elf rebellion at the moment. Just remember... Wishes and fishes make dishes. You can always help yourself. 


Ciao
Santa


Hwhat? Isn't the plural of fish, just fish? For a second I thought Santa was punking me but then I remembered the guy has a track record of not making perfect sense. He gets a pass on ho ho ho right? I can give him a pass on some gibberish in a quick email he was kind enough to write. 


My second surprise of the day came when I opened the paper.


Hot in the Cold 


The North Pole saw another week of violent protests following the unexpected initiation of austerity measures this last April. A spokesmen for the International Brotherhood of Elven Workers stated, "King Nick is playing Kung Pow Chicken with Christmas. The magnificent son-of-a-bitch actually threatened to bid out our contract to the Chinese. Can you believe that? Saint my Elven ass! Cindy doesn't want a lead paint pony for Christmas. Ack...spit... choke.. We will bite his fucking knee-caps off before we let him kill Christmas." We were unable to reach Santa for comment prior to this story going to print.


I spent the rest of the morning thinking about angry IBEW elves and Santa's limerical advice. I finally figured out Santa was telling me to break my wish list into parts and tackle them individually. 


Wouldn't you know it, here I am thinking about my wish list and I just so happen to surf across a net-metering story. The story has Travis Bradford duking it out with Barry Cinnamon. Awesome right... Two experts discussing a hot topic. After a few volleys it becomes clear the two are sacrificing their message for entertaining antics. I actually finished the article feeling the two weren't experts at all. 


From the Beginning


Many jurisdictions around the US, Canada, Japan and elsewhere offer various versions of net-metering. The standard version of net-metering gives customers with photoelectric systems (or other on-site generation) a credit for any excess electricity they backfeed into the grid. The credit is generally one to one - i.e. If you backfeed 10 kWhs of electricity you get 10 kWhs back at some later time. It's basically a trade with no transaction fees.  


Pros

• Getting full retail value for excess feed is a sweet deal for photoelectric system owners
• Simplifies initial system design - you build your system to match annual load
• The mechanics are physically easy to understand
• The great thing about net-metering programs is that they allow photoelectric system owners to get the benefit of the grid without paying for it.

Cons

• Full retail value for excess feed is unsustainable at large scale
• We're building poor habits into our system designs processes
• The scheme obscures market signals
•  The problem with net-metering programs is that they allow photoelectric system owners to get the benefit of the grid without paying for it. 

Sweetness vs. Sustainability


In the ideal net-metering situation a photoelectric system is sized to perfectly displace the site's annual electricity usage. In this situation the production credits cancel out all the electricity costs so all that's left are some connection fees and meter charges. This is a great deal for a photoelectric system owner. Unfortunately, what's good for the goose won't work for the gander. 


Buying electricity is like buying something on ebay. You pay X for the actual product plus Y for Shipping and Handling (S&H) and Z for any applicable taxes. With electricity it's not uncommon for S&H and taxes to cost nearly as much if not more than the underlying energy. This makes sense when you consider that power grids are the largest and most expensive machines on the planet. The S&H charges have to cover the costs of power lines, underground cables, transmission towers, substations, regular maintenance and continuous management. These things add up. 


As net-metering programs grow, more and more people going solar means fewer and fewer people paying more to cover the costs of the grid. Additionally, utility territories with tiered tariffs will see a non-linear redistribution of charges. Things start out slow and innocent but the extra charges to non-solar rate payers can add up quickly. 


Situation A


An average customer uses 500 kWh per month. Electricity is sold at a flat rate of 20 cents per kWh. The 20 cents per kWh  is 10 cents in energy costs, 5 cents of S&H costs and 5 cents of taxes. The bill is $100 per month.


If we want to make solar pay its way we need to do is pull the S&H charges out of the volumetric portion of the bill and make them a fixed cost. 


Situation B


An average customer still uses 500 kWh per month. Electricity is sold at a flat rate of 15 cents per kWh. The 15 cents per kWh  is 10 cents in energy costs and 5 cents of taxes. S&H costs are covered by a fixed charge of $25. The bill is $100 per month


Situation X


There are multiple versions that fall between A and B. A practical policy would be to shoot for the middle and have a temporary transition type tariff with $12.50 in fixed costs per month and electricity that cost 17.5 cents/kWh. The feedback from the temporary tariff will inform further development. Specifics aren't terribly important here - Understanding the basic mechanics of adjusting tariffs is the idea. 


Upside Down

In the net-metering article I mentioned above, Bradford uses a strange bit of circular logic to argue that we should keep net-metering right where it is. His argument starts with pointing out that photoelectricity is "bringing down the average clearing prices of all power" on the grid. This much is true. 


Bradford is talking about Germany where daytime wholesale electricity prices are hitting lows that you'd normally expect in the middle of the night. Interestingly, this new phenomena has resulted in pumped hydro plants running two cycles per day - one in the middle of the day and another in the middle of the night. 

After correctly pointing out that solar power reduces wholesale electricity prices Bradford changes gears and suggests we should move to “a more fair system that uses a correct locational marginal price for what it costs and the capacity charges, and using time-of-use rates for when the stuff is generated”. He then suggest that if we moved over to LMP, utilities would "end up paying more than they are currently paying under net metering.” His general point is that utilities should be happy where they are - let's not change a thing. 


You need to replay Bradford's logic a few times in slow motion to see where the fouls takes place. If solar is pushing daytime wholesale prices down that's going to push down time-of-use rates as well. This is going to hurt rather than help solar's competitive position. Additionally, if Bradford really thinks utilities are getting a good deal with net metering he shouldn't be defending net metering - he should be arguing for a transition to locational marginal prices. A friend of mine once called Bradford - and I'm paraphrasing here - a dumbass. I can see it. 


Change Oriented 


The little imp that was Solar has grown up and multiplied. One gigawatt, two gigawatt, three gigawatt, four - 10 gigawatt, 20 gigawatt, 40 gigawatt, more. Europe currently has an imp army on their hands and it's actually changing the way the market behaves. The US, China, Japan and elsewhere will see a similar multiplication. It's a foregone conclusion that all these places (meh... scratch China) will see solar change wholesale market patterns and upset the status quo. Solar is honestly and truly a big fucking deal. Spiderman taught us that with great power comes great responsibility. Solar advocates don't seem to understand that solar has a responsibility to change along with the market it's changing. The solar crowd is having none of it - they are la la la singing a song about how we need stable policy for stable investment. That's not going to work. Solar is moving too damned fast for stable policy. Our focus cannot be on stable policy - our focus needs to be on smart policy. 


Smart solar policy is a moving target. We aren't going to get solar policy quite right on the first, second or third go-round. So what... Failure is part of figuring things out. 


It's time to give a damn... Let's work together...

Etcetratech...

Etcetratech - The Perfect Beast

Rob Day consistently writes good stuff. His latest piece is particularly thought provoking. Here's a snippet.

The argument we've made as a sector so far goes like this: Clean technologies (or green technologies or advanced energy or whatever the heck is the latest punchless label du jour) are going to be big in the future, so clean technologists should be considered vital for America's economic future.

I'm going to go out on a limb and assume Rob doesn't want to say "heck"... he wants to say FUCK! He might even want to say FUCK FUCK! because sometimes one FUCK! isn't enough... Anyways, Rob has to play with kid gloves. I don't. 

Here's my offering for the new punchless label du jour.. Etcetratech

The funny thing about Etcetratech is that we're told to believe it's vital for our future but we don't really know what it is. We've jumble juggled the names, over promotionalized the possibilities and gerrymandered the fidelity right out whatever it was we thought we meant to try to define.

Here's how bad it is... In the Bizarro world of Etcetratech, clean doesn't necessarily mean clean. A subtle marketing twick has somehow allowed clean to mean cleaner. A reasonable person would say, ok, you mean cleaner than clean right - like ultra-clean or something. No!!! Come back one year!!! In the world of Etcetratech clean may be defined as, cleaner than dirty. Imagine what would happen if you tried this logic with your mother.. 

Mom:John Robert Anderson! You are absolutely filthy. Go wash yourself up. 

John:Yes Ma

Mom:What's all this dirt and grub on my new carpets. I told you to wash.

John:Can't you see my hands are cleaner than they was? I cleaned em' like you said. 

Mom:Cleaner you say? Well I know someone who's going to have the cleanest clock of all time. 
John:Who Ma?
Mom:It's a surprise. Your dad will tell you when he gets home. 

After reading Rob's article I watched an old interview between Larry King and John Stewart. Stewart riffs on the idea that the news needs more analysts and less pundits. Stewart explains how the news has become a staged debate between Coke and Pepsi. The Coke guy gets 5 minutes to say why he likes Coke and the Pepsi guy gets his schpeal and then there's a commercial break. After the commercials the moderator finishes the show with, "that's all the time we have, YOU decide." 

The Etcetratech media is playing a similar Coke vs. Pepsi game but with a larger and more awkward schmorgesborg of choices. In a strange way the game isn't really about choosing at all - it's about giving the audience the feeling of choice. This is where John Stewart's point comes back in - the energy debate needs more analysts and fewer pundits. We don't need slick/shiny advertisements that make you feel good - we need better information so we can make better choices. Sometimes you need to call a dumb idea a dumb idea and not give it the time of day. Sometimes, you need to admit a horse is dead even though it may have been a great horse in its day. The editors of the offending news outlets like GTM, REW and RI need to step up and start containing the debate. 

Wait, wait, wait cries the defender of choice

• We shouldn't put all our eggs in one basket.
• There are no silver bullets. We need a little bit of everything.
• We need a Free Press. 

First off, I'm all for energy diversification but we already have plenty of baskets. Secondly, I don't believe we need a little bit of everything - we need the best of the best. Thirdly, free press my ass. We've got too much press printed because it fits and not enough that's fit. Let's up the quality a couple notches. 


I'm not talking about a revolution in thought here - I'm talking about an attitude adjustment. Personally, I know I'm tired of the saccharine Coke vs. Pepsi game show I've been reading about for many years in the green news. I figure a lot of people feel the same way because that's just how the Zeitgeist works. If the show sucks, change the channel. Better yet, listen to some music or go out and actually see a movie in the theater. Anything that doesn't suck should work. 

Not a Million Dollar Baby

In 1956, Daryl Chapin calculated a homeowner would have to pay $1,430,000 for an array large enough to power an average home. Faced with these high prices Daryl Chapin asked, "What to do with our new baby?" 

Current prices in Germany

A 12 kW system for 1367 €/kW (1780 USD/kW). Trina panels and Fronius inverter.
A 10 kW system for 1650 €/kW (2150 USD/kW). Mage panels and Danfoss inverter.
A 7.65 kW system for 1730 €/kW (2250 USD/kW). Aleo panels and Kaco inverter.
A 11 kW system for 1550 €/kW (2020 USD/kW). Trina panels.
A 4 kW system for 1800 €/kW (2340 USD/kW). CSI panels and SMA inverter.

The German market has had five weeks to respond to the new FiT rates. Average prices appear to have fallen to around 1700 Euro/kW. This exceptionally sharp drop has been driven by two, maybe three general factors. 1. Extra demand before the FiT cut held Q1 prices up. 2. The FiT cuts were deep. Put these things together and you get big adjustment.

The correction in average prices may also be related to the new FiT tranches. The popular 10 to 30 kW tranche was absorbed into a larger 10 to 100 kW tranche. This was a double whammy for the 10 to 30 kW tranche because this market segment had to absorb the lower FiTs associated with a higher tranche and a FiT reduction associated with the program overhaul. This took the FiT from 24.43 ct/kWh to 16.5 ct/kWh. In 2011, 20% of the market - a full 1500 MW - consisted of systems sized 10 to 30 kW. It will be interesting to see how this market segment develops this year. Judging from the prices I'm seeing it's going to be a good year.

Fun Fact # 1: Average household electricity consumption in Germany is approximately 3500 kWh/year.
Fun Fact # 2: Each kW of capacity in Germany will produce 700 to 900 kWh per year.

From these numbers you can figure a homeowner in Southern Germany would need a 4 kW photoelectric system to cover 100% of their annual electricity demand. At current prices this would come to 7200 Euro (9370 USD).

Things have come a long way. What to do with our new baby!