22 March 2012: In an article published in the European Energy Review, International Energy Agency (IEA) Executive Director Maria van der Hoeven wrote that reduction of subsidies for renewables is not a reflection of spending cuts and austerity, but that renewables are “coming of age” and the need for public support for the sector has been reduced.

Van der Hoeven said policy changes in the renewable energy sector must be made more transparently and predictably, and never be retroactive, to maintain investment security. In the article, she described a set of successful incentives programmes in which generators sell energy to the grid at guaranteed prices, supported by feed-in tariffs. She said that while these tariffs broaden the pool of renewable energy sources to include bioenergy and onshore wind, they have a negative effect on the market for solar photovoltaics (PV) for which the non-flexible tariff rates increased investors profit margins. Noting Germany’s plan to reduce support for solar PV, she indicated cuts may be appropriate to correct policies ill-equipped to deal with the rapid pace of development. [IEA Press Release] [Subsidy Cuts Show that Renewable Energy is Coming of Age]