Luxembourg is unique with regard to its energy consumption and that is because it is completely landlocked and has hardly any indigenous energy resources resulting in it being completely dependant on receiving its energy requirements from imports. Luxembourg is the smallest country in the EU and 92% of its imported power is from Belgium and Germany.

It was agreed in March 2007 by the European heads of state that that targets should be put in place to increase the share of renewable energy and that by 2020 this target should be 20% of the final energy consumption. That figure is an average across the European Union but taking into account the the various factors which affect Luxembourg, the target was put at 11% which when compared with the figure of 0.5% in 2005 was considered to be relative.

Despite the many support measures that were put in place by the EU to assist the population of Luxembourg to embrace solar power it must be said that significant progress was not made and this was attributed to the limitations that were put on the eligibility for various installation grants and incentives.

This situation has improved somewhat and statistics show that the country is on target to meet the 2020 requirements. The reason for this is being attributed to the increasing speculation regarding the carbon footprint and the rapidly increasing prices of fuel across the world.

In 2008 a grant was introduced which was aimed at encouraging private household in Luxembourg to install solar heating systems. This grant is among the most generous in Europe and comprises of an award of up to 50% of the total investment for the solar panel and heating installation. This installation must be carried out by a recognised company and these companies have been instructed how to calculate the exact amount of any grants that are applicable.

Luxembourg have had a feed-in tariff in place since 1993 but this was amended in 2008 and it is set out in a different way to the equivalent tariffs in the rest of Europe in that the amounts involved are very easy to understand.

The amended tariffs are only applicable to installations that have been registered after January 2008 and they are guaranteed for 15 years. The tariff has been set at 420 Euros per Mwh for PV panels that are under or equal to 30kW and 370 Euros per Mwh for the larger panels of 31kW to 1000kw. There is an annual reduction of these payments of 3% over the 15 year term.

More information on the feed-in tariffs can be found at http://ec.europa.eu/research/energy/pdf/1045_busquin_en.pdf