See, now, this is the problem with government-led green energy initiatives. Germany has been one of the biggest boosters of solar energy, so much so that on conference calls, companies like First Solar (FSLR) spend a lot of time talking about where things stand with German subsidies. But German weather sucks. It’s Western Europe. Grey, cloudy, rainy, etc.
And now it’s worse than usual. FBR Analyst Mehdi Hosseini passes on some intelligence
Mother Nature not cooperating with the solar PV industry. As harsh weather (snow, rain) continues throughout Germany, our recent checks have unveiled that many (rooftop) solar installations have come to a standstill and are put on hold. We have heard from several large developers and installers in Germany that many projects may not be completed on time in 4Q (before the current FIT scheme expires) since installations are physically impossible under the current climate.
Could have installers foreseen this? Why should this be surprising, when demand in Germany seasonally weakens in the 4Q/1Q time frame? We note that winter last year was mild, but was harsh in CY06. In a nutshell, similar to predicting the end-market demand for the solar PV industry, the weather this year has been very challenging to predict, and several installers have actually told us that they have been caught off guard by the severity of the weather and its impact on installations (for both residential and large commercial rooftop projects).
As noted, the inclement weather is only part of the weather issue. The main thing is that Germany was never going to be a natural country to capture solar energy efficiently cause of it’s overall climate. But stillborn industries are common when the government takes it on itself to foster them. Think ethanol. Or think when Castro decided that Cuba should be a steel powerhouse.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.