Solar Burgeoning in Italy; Even UK Getting On-Board

Despite the gloomy world economy, solar power is still in growth mode. Granted, financial incentives to go solar are required to spur the paradigm shift from conventional electricity sources. Most incentives in the U.S. are cash rebates and tax credits while Europe seems to favor feed-in tariffs. Germany, Spain and Italy are the leaders over there.

Today, solar is burgeoning in Italy as the country now pays up to .49 Euros (about 64 cents) per kilowatt hour produced by the sun. This is larger than those tariffs offered by Spain and Germany, the world's leader in photovoltaic installations. Italy's generous tariff is encouraging start-ups such as V-energy in Milan which is being funded by shareholders and regional development programs in that country.

"The market is good, despite the crisis. The main problem...is to get bank financing. But the incentives are so appealing that people go for it," said Miriam Dase, a V-energy consultant.

Better yet, the feed-in tariff approved in 2007, is guaranteed for all kWh produced for 20 years, making the PV sector a safe haven type of investment. As one Italian PV professional said it is like investment in government bonds with a bigger yield. Italy's good sunshine and hefty incentive allows PV system operators to get payback in 8-10 years, faster than any other European country.

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The UK government has committed to introducing a feed-in tariff by 2010. This goal is bolstered by recent research which said 91% of Britons would consider buying PV systems if the "price is right."

The current price per kWh is 15p (about 21 cents) and PV owners are getting up to 20p from certain energy suppliers. The survey found that 90% of the public would bite on solar if the feed-in tariff was set at 50p per kWh, about 70 cents. This would be the highest such tariff to be implemented in Europe. The survey also showed feed-in tariffs are a much bigger incentive for British consumers than a grant for the same purpose. Finally, the research revealed Britons believe the country has not done enough to promote renewable energy technology. A healthy tariff could turn that around quickly.