Greek solar energy industry is healthy but needs some support

Over one-and-a-half million solar-run thermal systems atop buildings across Greece provide hot water and cool air to households, hotels, hostels, hospitals, factories and more as the only renewable energy source properly tapped in this country. In terms of the installed surface area of solar panels, Greece is among the world’s leaders with 256 square meters per 1,000 inhabitants, on a par with Austria and only behind Cyprus at 616 and Israel at 580 sq.m. per thousand people. More than 20 medium-sized enterprises employing about 3,000 people produce the bulk of systems in Greece, comprising a quite remarkable industrial activity. All these companies are members of the Greek Solar Industry Association (EBHE), along with several other smaller ones in the sector. Recent EBHE data show that the total production of solar panels last year reached 375,000 sq.m., compared to 160,000 sq.m. in 1994. Crucially for the industry, some 50 percent of the volume produced is exported, particularly to countries in North Africa and the Middle East, but also to Germany. Greece is estimated to have more than 3 million sq.m. of solar panels installed, serving about a million buildings. Although solar thermal installations do not directly produce electricity, they do substitute for massive quantities of power: both for the heating of water for households, hotels and industries (some 1.5 million gigawatt-hours per year) and for air conditioning, especially in the summer months when power demand peaks. Without those solar thermal systems, the country’s electricity grid would have an installed power deficit of at least 500 kilowatts. What is more, the existing solar thermal installations contribute to the reduction of air-polluting emissions by 2 million tons of carbon dioxide per year, while the potential with an increase of systems is for an additional 2 million tons. Solar industry prospects The significance and the prospects of the sector in Greece are presented in an interview that the president of EBHE, Manolis Kastanakis, gave to Kathimerini: Greece at present is among the leaders in solar thermal systems, know-how and applications. Can you explain the reasons behind this success? Greece stands third in the world in solar panel surface per person and second in Europe, behind Germany, in absolute figures. After the 1974 oil crisis, new ways of substituting conventional oil or electrical energy were sought. At the same time, the state offered tax exemption incentives for every solar water heater installed. Unfortunately these incentives were recently abolished. Is the Greek lead in solar thermal applications under threat and, if so, by whom? Our lead in solar applications is threatened by European and other countries which are showing great strides, such as France, Great Britain, Poland, Spain, Italy, Austria and, of course, Germany. All these countries have recently provided serious incentives for the development of solar thermal applications. Is there scope for the further development of the Greek solar energy industry? What objectives can be set? The growth of the domestic solar energy industry is seen only in its export by Greek industries. Sales in Greece are stagnant due to the abolition of the old incentives and the concession of too few serious incentives today. The objectives that could be set are the doubling of sales and of the sector in general over the next five years, considering the increased needs on the islands and on the mainland, as well as using solar thermal applications for heating spaces and water. As far as Greek consumers and users of solar systems are concerned, do you think they are in front of competition from other energy sources, such as natural gas for instance? Indeed, the state has made great investments in natural gas applications, which is the cleanest form of the other conventional energy sources. However, in no way is that a renewable energy source. Nearly every natural gas appliance for heating rooms has a switch for heating water, consuming fuel, of course. Solar heaters offer the same with energy that is not charged. There certainly is some competition, because if consumers were to satisfy their needs with natural gas appliances they would not need what solar heaters have to offer. Is there a need for incentives so that the local solar system market grows? What should these incentives be? Without incentives the development of the solar systems market is impossible, as has been reported at all conferences and meetings between the state and private bodies. The incentives ought to be simple in their application, referring to household use and not to major installations (the Greek solar systems industry developed through solar applications). The proposals for those incentives have been submitted to the competent ministries by EBHE and other important bodies. They include: – Reduction of value-added tax from 19 percent to 9 percent, as each kilowatt-hour is charged by PPC. – A subsidy for each installed sq.m. of solar collectors with a specific amount, as has been done in most countries in the world with significant growth. – The return of tax exemptions for the final consumer. – Solar systems in all public buildings. – Compulsory application of solar systems in new buildings, with relevant incentives.