German and Chinese Solar Firms Fight for Survival - SPIEGEL ONLINE
People in Germany aren't buying all these solar modules because the sun shines particularly often in their country. They're buying them because they will receive subsidies known as feed-in tariffs for the electricity for 20 years. The state has guaranteed every producer of solar power a price that was initially 50 euro cents per kilowatt hour higher than the market price.
Since making solar modules is no longer difficult, more and more companies have entered the sector in recent years, not only in Germany and China, but also in Japan and Korea. However, the subsidies available in Germany have not been limited to electricity produced by German-made solar panels, as politicians did not specify where the modules should come from. In Italy, by contrast, power customers receive a bonus for installing solar panels made in Europe. As a result, the German subsidy program has had an effect across the world, and primarily in Asia.
This led to a bubble in the solar-technology market. Manufacturers worldwide were soon making far more modules than customers wanted to purchase, and they started to undercut each other's prices, which fell by 50 percent last year.
Since then, one manufacturer after the other has filed for bankruptcy, more than half a dozen in Germany alone since December.
The Germans have shelled out over 100 billion alone in funding for the solar panels that have been installed to date. This is paid for by all electricity customers, who will soon be shelling out 4 cents per kilowatt hour on their utility bills to support solar power.