The Wrong Way to Create a Solar Market

In 2008, Spain was the top market for solar installations. In 2009, it will fall to 15th. It's all due to erratic decision making by the government.

Greentech Media explains it all in an essay which provides a blueprint for what not to do while trying to increase use of solar power.

Here's the truncated version of the story:
Spain decided between 2007 and 2010 it would pay above market rates for electricity that came from solar plants to spur growth in the solar industry. It planned on subsidizing 400 MW over 3 years. Solar developers installed 344 MW by the end of 2007.

Spain panicked. It adjusted the cap, but not enough to accommodate all the new solar plants that were built. It also lowered the amount it would pay above market for solar energy. With the cap kicked, solar developers moved on.

The feed in tariff did nothing to create a vibrant solar industry. Solar companies came in, took advantage of what there was to take advantage of, then they moved on.