BERLIN Germany's ruling parties have reached a deal on reduced support for the solar energy sector which involves cuts of 8 percent in 2009 and 2010, and 9 percent in 2011, Social Democrat politician Hermann Scheer told Reuters.
The cuts in support for rooftop solar panels, which supply the lion's share of Germany's solar-produced energy, fall far short of those demanded by some German conservatives, who had pressed for a decrease of 30 percent in 2009.
German law requires utilities pay solar energy producers higher prices for solar power they put into the grid. But the government says the industry can live with less support and wants to redirect help to other types of renewable energy.
Shares in German solar power companies rallied, topping the leaderboard of Frankfurt's technology index after the deal came in with lower cuts than expected.
Q-Cells was up 7.6 percent, Solarworld gained 6.7 percent, Phoenix Solar improved 6.1 percent and Ersol rose 4.7 percent by 0730 GMT.
The chief executive of SolarWorld told Reuters the cuts to the support measures for solar power in Germany were bearable.
In 2015, power produced using solar cells will be competitive with electricity generated from fossil fuels, Chief Executive Frank Asbeck said.
The rooftop photovoltaic industry has boomed in Germany in recent years. More than half the world's photovoltaic energy is produced here, much of it from the 300,000 systems on rooftops in Europe's largest economy.
A 2000 renewable energy law sparked the boom, a law which has since been copied in more than a dozen EU countries.
(Additional reporting by Peter Dinkloh; Writing by Noah Barkin; Editing by David Holmes)