The Feed-in Tariff (FIT) is an bonus made to recompense the production of renewable energy both by households and investors. Power companies are compelled to purchase back, at rates higher than the market, power produced from renewable sources; such as wind, thermal solar, photovoltaic solar, biomass, hydro and geothermal. This tariff goes also under the name of Feed-in Law, Solar Premium, Renewable Tariff or Renewable Energy Payments. FIT helps make the production of renewable energy more economical. Usually governments assure the tariff for up to 15, 20 or even 25 years from the date of the setup.

The development of sources of renewable energy is considered crucial to preventing climate change. Producing renewable energy still costs more than the cost of producing energy from traditional supplies. FIT tries to offset this difference, thus making more attractive renewable energy installations, mandating power companies to put into the grid the electricity generated by renewable installations. The difference in cost is spread over all of the customers of the power grid. FIT requires net metering regulation to account for power purchased from the grid and energy sold to the grid.

FIT is seen as more effective than quotas leavied on power companies, because it satisfies the ethical motives of people. What follows is a simplified indication of FIT policies by some European countries.

2008 was a record year for PV solar industry in Spain as far as installed power, new employments and investments are concerned. 2009 will be considered as a record pessimistic year for the same business. In the first six months of 2009, 28.000 people have already lost their job and not owing to the world economic crisis.

The origin of this negative year resides in a law made by Zapatero’s administration in 2008: namely RD 1578/2008. RD 1578/2008 replaces RD 661/2007 that had just been implemented the year before by the same government. The new RD changes the following:

* Introduction of a yearly share for installed power
* Average FIT (Feed-In Tariff) reduced from .47€/kWh to .29€/kWh.

The consequence has been a rush by the industry to install and sell as much as possible before its putting into force. Between January and September 2008 2,700 MW were deployed in Spain, an increment of 385% over 2007. Spain became the country with the largest PV park installed. The case looks from top to bottom singular for 2009. A mere 200 or 250 MW will be set up. The industry will loose one third of its 42,000 direct jobs. The total funding go down from 16,000 million € to 1,600 million €.

The socialist government, again, proved insufficiency of insight and  weak arrangements. They bred a speculative tendency by offering kind Feed-In Tariffs, only to reduce them only one year later on; accordingly, turning into losing any investment made by operators in the business. This includes stocks, signing up and preparing, as well as company development and foundation. The FIT created in RD 661 did not allow for the price of energy and contributed to the broad deficit of the energy industry. And the new FIT lauched in RD 1578 is exceptionally conformist and has affected a crisis in the industry.

The expenditure for production of PV energy keeps reaching lower and lower due to advances in technology. This is particularly accurate with concentrated photovoltaics that moderate greatly the amount of silicon crystals indispensable. It appears likely that in a matter of two to three years the photovoltaic set up in Spain during 2008 may look archaic and expensive.

2008 was a record year for PV solar industry in Spain as far as installed power, new jobs and investments are concerned. 2009 will be brought to mind as a excessively pessimistic year for the same business. In the first six months of 2009, 28.000 people have already lost their job and not because of the world economic crisis.

The cause of this depressing year lies in a law made by the socialist administration in 2008: namely RD 1578/2008. RD 1578/2008 changes RD 661/2007 that had just been put into force the prior year by the same administration. The new law changes the following:

* Introduction of a yearly allowance for installed power
* Average FIT (Feed-In Tariff) dropped from .47€/kWh to .29€/kWh.

The effect has been a rush by the industry to install and sell as much as possible before its coming into force. Between January and September 2008 2,700 MW were set up in Spain, an increment of 385% over 2007. Spain became the country with the largest PV park deployed. The situation looks from top to bottom different for 2009. A mere 200 or 250 MW will be set up. The industry will loose one third of its 42,000 direct jobs. The entirety of funding dismount from 16,000 million € to 1,600 million €.

Zapatero’s administration, again, showed insufficiency of insight and  frain preparation. They produced a speculative leaning by proffering munificent Feed-In Tariffs, only to reduce them simply one year afterwards; thus, leaving unprofitable any investment made by operators in the business. This includes reserves, engaging and teaching, as well as company growth and formation. The FIT started in RD 661 did not take into account the fee for energy and contributed to the general shortage of the energy industry. And the new FIT established in RD 1578 is exceptionally middle of the road and has affected a crisis in the industry.

The price tag of production of photovoltaic energy keeps dropping lower and lower due to progresses in technology. This is mainly accurate with concentrated photovoltaics that lower very much the quantity of silicon crystals needed. It looks probable that in a matter of two to three years the photovoltaic installed in Spain during 2008 may appear superseded and expensive.