There is a widespread belief in Germany that the country can't compete with China on costs and must aim for superior quality. But in an industry in which solar wafers and panels are becoming commodities, Aulich thinks Germans have it backward: Through specialization and automation, they can cut out labor costs and beat China at its own price game.
That may not be good news for Germany's employment rate -- but it may just allow the country to beat China at its own game. Wedepohl of BSW-Solar agrees, arguing that Germany is uniquely positioned to capitalize on the trend toward automation.
"Labor costs are not a large factor because of automation," he says. "And you know who's good at automation? The Germans!"
German technology may still rule the day, but the country itself isn't likely to be home to the world's solar parks of the future. Germany is once again a victim of its own success -- it has not only succeeded in bringing down solar costs domestically, but around the world. Now that Germany has put in the initial investment to make solar energy cost-competitive, it's suddenly viable in countries that might not have been able to make the investments themselves.
Merz says that in "unbankable markets" like Greece, feed-in tariffs wouldn't have worked because people wouldn't have trusted the government to honor its price guarantees. But now that Germany has pushed solar technology over the hump, "it will come at much lower costs for the other countries," he believes. Saferay itself is looking to get in on the action, with plans for solar farms in sunnier California, Chile, and India. (The California and India projects are still in the early planning stages, but the Chile installation, set to be completed in August, will use Chinese panels.)
"Five years from now, Germany's not likely to be the largest solar market in the world anymore," says Kann of GTM Research.
But even if German solar cell manufacturers are unable to survive and new solar installations gravitate toward sunnier climes, Germany can continue to profit from its decision to go all-in on solar power when no one else would. Germany's strength, after all, is advanced technology, and though Chinese firms may be making most of the solar cells, German companies like Jonas & Redmann are building many of the machines used by the Chinese to manufacture the cells.
"It will be the German companies that will bring the technological advantage to other countries," said Merz. "That's what Germany always benefited from: from exporting this know-how, this technology, to other countries. So just because the installations now move to other countries doesn't mean the German companies won't make money anymore."
If nothing else, Germany has shown the world that a little political will goes further than a lot of sun. Even in gray Germany, with the right incentives in place, the roof of an average single-family home with a typical solar installation generates about as much electricity as the household consumes. On a recent atypically sunny Saturday in May, the country hit a new solar milestone by producing a world-record 22 gigawatts of solar power at midday, the equivalent of 20 nuclear reactors and enough to cover nearly half of the country's electricity needs at the time. Wedepohl expects German solar energy production to keep growing, despite the current troubles, and provide 10 percent of the country's electricity by 2020.
In five or 10 years, there may not be a German solar manufacturing industry to speak of, and the country may be blanketed in Chinese panels. But Chinese panels still produce electricity, and they wouldn't grace rooftops around the world had it not been for the road paved by Germany's bold solar ambitions. The process that Engelsberger and Daniels set in motion has ushered in an era of solar power in Germany beyond their imaginations. At the end of the day, this dark cloud has a silver lining.