A Strange Result on Costs?

I was wondering how much it would cost Germany to continue using FiTs until their 52 GW target? Here's a guess. I've arbitrarily used the magical 435 MW/month installation pace from the previous post and broken it up between the tiers like so.

Rooftops up to 10 kW	Rooftops 10 to 40 kW	Rooftops 40 to 1000 kW	Rooftops 1 to 10 MW	Ground < 10 MW
15%	30%	40%	10%	5%

In the first month (November 2012 in this case) 15% of the 435 MW (~65 MW) are installed in the < 10 kW rooftop category which gets a FiT of 17.9 cents/kWh. To calculate the incremental extra annual cost you subtract the Wholesale Cost of electricity (assumed to be 5 cents/kWh) from the FiT rate (17.9 - 5 = 12.9 cents/kWh), multiply this value by the total MW installed in that Bracket (65 MW) and then multiply that total by the expected production which is assumed to be 1000 MWh per MW. I've done this procedure (with some tweaking) for each bracket and summed the total below.

As you can see from the table, over time the incremental cost of each additional 435 MW is less and less because the FiT falls month by month. The sum total extra annual cost I came up with was just under a billion. Interestingly, if you project out the FiT degressions the extra cost of the FiT program go negative in November of 2017 - i.e. If you keep dropping the FiT you actually start saving money over wholesale in about 5 years.

I have mixed feelings here. On the one hand I know the FiT is probably a tad too generous and this means you can shave it down. On the other hand look at how low these extra costs are! Why screw with a good thing when it's cheap to let it ride?

**NOTE: Something about these results doesn't seem right. I suspect I may have dropped something in the math somewhere because this just seems too good to be true. I've double and triple checked things but I keep coming up with the same results. The graph says it all. Germany is in the Home Stretch.

Year	Rooftops up to 10 kW	Rooftops 10 to 40 kW	Rooftops 40 to 1000 kW	Rooftops 1 to 10 MW	Ground < 10 MW	Total
Nov-12	5,892,025	14,072,798	17,654,148	3,215,621	1,607,811	42,442,403
Dec-12	5,687,631	13,574,166	16,995,294	3,080,856	1,540,428	40,878,374
Jan-13	5,488,346	13,087,999	16,352,912	2,949,459	1,474,730	39,353,446
Feb-13	5,294,044	12,613,987	15,726,589	2,821,348	1,410,674	37,866,641
Mar-13	5,104,599	12,151,824	15,115,924	2,696,439	1,348,220	36,417,006
Apr-13	4,919,890	11,701,216	14,520,526	2,574,653	1,287,327	35,003,612
May-13	4,761,410	11,314,595	14,009,674	2,470,161	1,235,080	33,790,920
Jun-13	4,606,417	10,936,478	13,510,062	2,367,967	1,183,984	32,604,908
Jul-13	4,454,833	10,566,681	13,021,440	2,268,022	1,134,011	31,444,987
Aug-13	4,306,584	10,205,019	12,543,569	2,170,275	1,085,138	30,310,585
Sep-13	4,161,597	9,851,314	12,076,210	2,074,679	1,037,340	29,201,140
Oct-13	4,019,799	9,505,390	11,619,133	1,981,186	990,593	28,116,102
Nov-13	3,906,335	9,228,588	11,253,389	1,906,375	953,188	27,247,875
Dec-13	3,794,914	8,956,768	10,894,228	1,832,910	916,455	26,395,275
Jan-14	3,685,498	8,689,841	10,541,532	1,760,768	880,384	25,558,023
Feb-14	3,578,052	8,427,719	10,195,184	1,689,924	844,962	24,735,841
Mar-14	3,472,539	8,170,315	9,855,071	1,620,355	810,178	23,928,458
Apr-14	3,368,926	7,917,544	9,521,080	1,552,039	776,020	23,135,609
May-14	3,267,178	7,669,324	9,193,100	1,484,952	742,476	22,357,030
Jun-14	3,167,261	7,425,571	8,871,025	1,419,073	709,537	21,592,466
Jul-14	3,069,143	7,186,206	8,554,746	1,354,380	677,190	20,841,664
Aug-14	2,972,791	6,951,149	8,244,161	1,290,851	645,426	20,104,377
Sep-14	2,878,173	6,720,323	7,939,166	1,228,466	614,233	19,380,361
Oct-14	2,785,258	6,493,652	7,639,661	1,167,203	583,602	18,669,377
Nov-14	2,694,016	6,271,062	7,345,547	1,107,044	553,522	17,971,190
Dec-14	2,604,416	6,052,478	7,056,727	1,047,967	523,983	17,285,571
Jan-15	2,516,429	5,837,828	6,773,106	989,953	494,977	16,612,294
Feb-15	2,430,026	5,627,042	6,494,590	932,984	466,492	15,951,135
Mar-15	2,345,178	5,420,050	6,221,087	877,041	438,520	15,301,877
Apr-15	2,261,858	5,216,784	5,952,508	822,104	411,052	14,664,306
May-15	2,180,037	5,017,177	5,688,763	768,156	384,078	14,038,211
Jun-15	2,099,688	4,821,163	5,429,765	715,179	357,590	13,423,385
Jul-15	2,020,787	4,628,677	5,175,429	663,156	331,578	12,819,627
Aug-15	1,943,305	4,439,656	4,925,671	612,069	306,035	12,226,736
Sep-15	1,867,218	4,254,037	4,680,409	561,902	280,951	11,644,517
Oct-15	1,792,500	4,071,759	4,439,562	512,638	256,319	11,072,779
Nov-15	1,719,128	3,892,763	4,203,050	464,260	232,130	10,511,331
Dec-15	1,647,076	3,716,988	3,970,795	416,754	208,377	9,959,990
Jan-16	1,576,321	3,544,377	3,742,721	370,102	185,051	9,418,572
Feb-16	1,506,840	3,374,873	3,518,752	324,290	162,145	8,886,900
Mar-16	1,438,609	3,208,421	3,298,814	279,303	139,651	8,364,799
Apr-16	1,371,607	3,044,964	3,082,836	235,125	117,563	7,852,095
May-16	1,305,811	2,884,450	2,870,745	191,743	95,872	7,348,620
Jun-16	1,241,198	2,726,825	2,662,471	149,142	74,571	6,854,207
Jul-16	1,177,749	2,572,037	2,457,947	107,307	53,654	6,368,694
Aug-16	1,115,442	2,420,035	2,257,104	66,226	33,113	5,891,920
Sep-16	1,054,257	2,270,770	2,059,876	25,884	12,942	5,423,728

Projecting FiTs in Germany

Germany installed another 435 MW in November. If December installs are greater than 350 MW we'll be up to 3250 MW for the period of July through December which means the degression rate will hold at 2.5% per month.

If installations were to magically stabilize at 435 MW/month here's how the FiT rates and total installs would trend out. I built a graph that captures the data better but am unable to upload the picture at the moment for some reason.

Year	Rooftops up to 10 kW	Rooftops 10 to 40 kW	Rooftops 40 to 1000 kW	Rooftops 1 to 10 MW	Ground < 10 MW	Total GW Installed
Nov-12	0.1790	0.1698	0.1515	0.1239	0.1239	32.0
Dec-12	0.1745	0.1656	0.1477	0.1208	0.1208	32.4
Jan-13	0.1702	0.1614	0.1440	0.1178	0.1178	32.8
Feb-13	0.1659	0.1574	0.1404	0.1149	0.1149	33.3
Mar-13	0.1618	0.1535	0.1369	0.1120	0.1120	33.7
Apr-13	0.1577	0.1496	0.1335	0.1092	0.1092	34.1
May-13	0.1542	0.1463	0.1305	0.1068	0.1068	34.6
Jun-13	0.1509	0.1431	0.1276	0.1044	0.1044	35.0
Jul-13	0.1475	0.1400	0.1248	0.1021	0.1021	35.4
Aug-13	0.1443	0.1369	0.1221	0.0999	0.0999	35.9
Sep-13	0.1411	0.1339	0.1194	0.0977	0.0977	36.3
Oct-13	0.1380	0.1309	0.1168	0.0955	0.0955	36.7
Nov-13	0.1355	0.1286	0.1147	0.0938	0.0938	37.2
Dec-13	0.1331	0.1263	0.1126	0.0921	0.0921	37.6
Jan-14	0.1307	0.1240	0.1106	0.0905	0.0905	38.0
Feb-14	0.1283	0.1218	0.1086	0.0888	0.0888	38.5
Mar-14	0.1260	0.1196	0.1066	0.0872	0.0872	38.9
Apr-14	0.1238	0.1174	0.1047	0.0857	0.0857	39.3
May-14	0.1215	0.1153	0.1028	0.0841	0.0841	39.8
Jun-14	0.1193	0.1132	0.1010	0.0826	0.0826	40.2
Jul-14	0.1172	0.1112	0.0992	0.0811	0.0811	40.7
Aug-14	0.1151	0.1092	0.0974	0.0797	0.0797	41.1
Sep-14	0.1130	0.1072	0.0956	0.0782	0.0782	41.5
Oct-14	0.1110	0.1053	0.0939	0.0768	0.0768	42.0
Nov-14	0.1090	0.1034	0.0922	0.0754	0.0754	42.4
Dec-14	0.1070	0.1015	0.0906	0.0741	0.0741	42.8
Jan-15	0.1051	0.0997	0.0889	0.0728	0.0728	43.3
Feb-15	0.1032	0.0979	0.0873	0.0714	0.0714	43.7
Mar-15	0.1013	0.0961	0.0858	0.0702	0.0702	44.1
Apr-15	0.0995	0.0944	0.0842	0.0689	0.0689	44.6
May-15	0.0977	0.0927	0.0827	0.0677	0.0677	45.0
Jun-15	0.0960	0.0910	0.0812	0.0664	0.0664	45.4
Jul-15	0.0942	0.0894	0.0797	0.0652	0.0652	45.9
Aug-15	0.0925	0.0878	0.0783	0.0641	0.0641	46.3
Sep-15	0.0909	0.0862	0.0769	0.0629	0.0629	46.7
Oct-15	0.0892	0.0847	0.0755	0.0618	0.0618	47.2
Nov-15	0.0876	0.0831	0.0742	0.0607	0.0607	47.6
Dec-15	0.0861	0.0816	0.0728	0.0596	0.0596	48.0
Jan-16	0.0845	0.0802	0.0715	0.0585	0.0585	48.5
Feb-16	0.0830	0.0787	0.0702	0.0575	0.0575	48.9
Mar-16	0.0815	0.0773	0.0690	0.0564	0.0564	49.4
Apr-16	0.0800	0.0759	0.0677	0.0554	0.0554	49.8
May-16	0.0786	0.0746	0.0665	0.0544	0.0544	50.2
Jun-16	0.0772	0.0732	0.0653	0.0534	0.0534	50.7
Jul-16	0.0758	0.0719	0.0641	0.0525	0.0525	51.1
Aug-16	0.0744	0.0706	0.0630	0.0515	0.0515	51.5
Sep-16	0.0731	0.0693	0.0618	0.0506	0.0506	52.0

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