Germany added around 7.5 gigawatts of new solar-power generation capacity in 2011, driven by strong demand for new facilities such as roof-top installations toward the end of the year, the country's network agency said Monday, citing preliminary figures.

If confirmed, the figure would be slightly higher than the previous record level of 2010, when 7.4 GW in new generation capacity were added, and would herald further sharp reductions in subsidies for solar energy, said Bundesnetzagentur.

Matthias Kurth, the regulator's president, said that growth in new solar power facilities was particularly strong in the last quarter of 2011, with some 3 GW in new installations in December alone. The December additions represent around 40% of the overall installations in 2011, Kurth said.

Kurth also said that the renewed strong expansion of solar power in Germany is likely to result in sharp reductions in solar energy subsidies.

"For the last quarter of 2011 alone we have recorded some 4,150 megawatt in new installations," Kurth said.

This figure alone would be enough to reduce solar subsidies by 12% at the next scheduled reduction July 1, he said. A further addition of only 225 MW in the first four months of 2012 would increase the subsidy cut to 15%, Kurth said.

Subsidy reductions for new solar plants are calculated every year, based on the capacity volume installed over the previous 12 months.

Germany promotes photovoltaic solar energy facilities--mostly rooftop installations--through feed-in rates that guarantee minimum prices for the electricity they generate. Effectively, electricity consumers are paying for subsidizing renewable energies.

German solar energy industry association BSW attributed the strong year-end growth to persistently low prices for photovoltaic solar modules, and to concerns that the unabated rapid expansion of solar energy could prompt the government to further reduce subsidies.

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