SolarWorld calls for lower subsidies amid expansion

HAMBURG (Reuters) - SolarWorld, Germany’s third-biggest solar company by revenue, has called for a faster reduction of German solar subsidies after announcing plans to massively expand its solar module production.

“The speed of the drop (in subsidies) should be increased,” Chief Executive Frank Asbeck told a news conference in Hamburg during the European Photovoltaic Solar Energy Conference on Monday.

He said that lowering feed-in tariffs -- incentives utilities are obliged to pay for power generated from renewable sources -- by 10-15 percent in 2010 was possible.

So far, the German Renewable Act sees feed-in tariffs declining by 8-10 percent next year, leaving higher returns for solar power producers than under the drop Asbeck has called for.

Asbeck said his proposal was bound to the introduction of general environmental and quality standards in regulation that would have to be followed not only by German but also U.S. and Asian players, creating a more level playing field.

“What we want is fairness,” Asbeck said.

SolarWorld also announced it would expand its solar module production.

“At all our locations, we are working close to capacity limits,” Asbeck said, adding that “business is buzzing.”

Asbeck said the company is planning to triple module production at its German plant in Freiberg in the German state of Saxony to 450 megawatts per year at a time when the industry is suffering from falling module prices due to overcapacities.

He said the move will create 500 new jobs in Germany. German solar cell maker Q-Cells said in August it would cut the same number of jobs, or about a fifth of its workforce.

Shares in SolarWorld traded 5.4 percent lower by 1525 GMT, underperforming the FTSE clean tech index, which was 1.1 percent down.

Reporting by Anneli Palmen, writing by Christoph Steitz; Editing by Jon Loades-Carter