German solar subsidies - safe with opposition until 2007

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Frankfurt listed Phoenix Sonnenstrom AG, which yesterday traded close to a new high of EUR 15.05, had a very high profile political visit late last week. Gerda Hasselfeldt, Deputy Chairwoman of the CDU/CSU parliamentary group and crucially in charge of parliamentary group's energy policy visited Phoenix SonnenStrom AG.

And what she said was critical;

"in the event of a change of government, the current Renewable Energy Act would remain valid until the end of 2007. From 2008 onwards, there will be a follow-up provision assessing the suitability of incorporation of other instruments, such as the eco-tax and emissions trading. Should there be new legislation valid from 2008, PV plants that are already up and running will remain unaffected."

This matters because there is a very good chance that Schroeder will lose Septembers National Elections. And Germany's massive energy subsidies are being blamed - amongst other things - for woeful economic performance.

So German solar investors can reckon with guaranteed income streams from the feed in tariff of up to EUR 57 cents a kilowatt hour, up to 2007.

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