Uncertainty over Germany’s solar subsidies is causing at least one major investor to pull back from solar stocks, according to Bloomberg.
Gabelli & Co’s SRI Green Fund has cut its holdings and is taking what fund manager John Segrich calls a “defensive view.”Germany’s coalition government has been debating the cuts to feed-in tariffs, which guarantee a premium price for electricity generate by solar power thereby spurring demand for panels, since the September election.
The German Environment Ministry is considering a delay in the 15 percent cut for one month, from April 1 to May 1. Other lawmakers from the ruling Christian Democrats have proposed cuts of 25 percent to 30 percent.
It isn’t clear how the cuts will shake out, but Segrich tells Bloomberg that the fund has “reduced a lot of exposure.” He declined to give specifics on the fund’s holding but has previously said the it was heavily invested in Chinese solar stocks.
The shares of one such Chinese solar stock, Suntech Power Holdings (NYSE:STP) , have fallen from a 2010 high of $18.40 on Jan. 5 to $13.55 at noon today.