A significant surge in PV installations, especially in December 2011, has resulted in a new record in Germany. According to preliminary figures from the German network regulatory agency, the Bundesnetzagentur, installations topped 7.5GW in 2011, slightly higher than record installations of 7.4GW in 2010.

Mild weather and falling module prices resulted in approximately 4GW of new power plant installations in the fourth quarter of 2011, while installations in December topped 3GW alone.

It is highly likely that an automatic FiT reduction of 15% will be imposed mid-year as roughly 225MW of new installations between January and April would trigger the cut.

In general, market forecasters and trade associations had expected installations to decline from the 2010 record levels due to very weak installations through the third quarter of the year to around 5GW.

However, industry overcapacity and declining prices across the supply chain would seem to have boosted investor IRR to levels making installations highly attractive, especially as new FiT cuts loom at the beginning of 2012.