Wednesday, May 30, 2012

UPDATE 1-Germany's Upper House Suspends Solar Subsidy Cuts

The German parliament's upper house suspended the government's proposed cuts in subsidies for the solar power industry on Friday and referred them to a mediation committee, in a setback for Chancellor Angela Merkel's conservatives.

The opposition and federal states who oppose plans to slash so-called feed-in tariffs by between 20 and nearly 40 percent from April did not get a big enough majority to reject the law in the Bundesrat, but had enough support to delay it, potentially for several months.

States run by the Social Democrats (SPD) and Greens, and some areas of Germany where solar power provides jobs and growth, defend the subsidies that have helped Germany become the world's largest market for power converted from solar radiation, or photovoltaic energy, with 25 megawatts of installed capacity - nearly half of the world's solar capacity.

"Photovoltaic power makes a considerable contribution to reducing the price of electricity," Winfried Kretschmann, the Greens premier of Baden-Wuerttemberg state, told the debate. "This law would put our success story at great risk."

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