The government in Italy will be making feed-in-tariff (FIT) cuts in June, and the industry believes a surge of demand about 2GW will happen in the second quarter before the cut.
Italy is likely to reveal new solar policies in April-May. The market believes the FIT cuts will be large, just like Germany.
If Germany's April 1 FIT cuts remain 20-30% as previously announced, the internal rate of return (IRR) will drop to 7%. Italy, on the other hand, currently has IRR of more than 15%, which is attractive for investors. Demand is likely to shift from Germany to Italy.
Nevertheless, the government in Italy has been controlling the number of large-size solar PV system installations above 1MW. Hence, installations are expected to increase only moderately.
Article translated by Jackie Chang
