Solar Power In Germany: A Tangible Rise Puts It On World Map

Germany, far from being a sun-loving nation, has one of the highest solar power outputs in the world in addition to state-of-the-art research. The government’s objective to largely base electricity production on renewables is most likely to give technology a prominent push. But, the solar power industry within Germany is struggling to stay at par in spite of the record installation numbers. Since technology’s large-scale launch by way of the Renewable Energy Act in 2000, German firms have gone on to quickly ascend to worldwide leadership in solar power technology, right before a collapse post-2012 that forced many of them to leave the business and go on to struggle with competitors that gave out cheaper options even more than 10 years later.


In spite of being among the countries with the fewest sunshine hours, Germany happens to be one of the largest solar power producers across the world. After leading the field for many years, the nation ranked 5th across the world when it comes to installed capacity across the International Renewable Energy Agency’s- IRENA global ranking in 2021. At the end of the last year, Germany boasted capabilities of almost 61 gigawatts- GW as per the figures by BSW Solar, a solar PV industry group.

Contrast to the traditional energy systems which focused on large as well as centralized producers, tens of thousands of small solar panel companies have gone on to become an integral part of German energy system. In 2023, the overall solar PV operators went on to together produce around 12% of the Germany’s net power consumption, thereby contributing to an overall renewable power share of 52%. Solar power’s global share within the power generation happened to stand at around 4.5% in 2022, as per the International Energy Agency- IEA.

Solar arrays can go ahead and contribute a much bigger share to the German power mix throughout the particularly sunny times. It is well to be noted that on 7 July 2023, solar power in Germany reached its highest output ever by offering 68% of the overall electricity mix at around noon, when both sun intensity as well as the usual power consumption happen to be at their peak. All across June 2023, solar PV happened to have an output of 9 terawatt hours- TWh as per research institute Fraunhofer ISE. Interestingly, the total output that year was 61 TWh.

Apparently, the high output, both in the short term at midday and also in the long term across the summer, happens to be offset by a reciprocally lesser or non-existent output throughout the winter and at night thereby highlighting need for dependable storage technology to keep in sync with renewables expansion. But the sunny weather and hot temperatures are not automatically going ahead and leading to higher solar power output, as solar modules go on to lose electric tension when they are hot, which in turn brings down their capacity in spite of the stronger radiation.


The large-scale roll-out when it comes to solar power installations started around the year 2000 and went on to peak for the very first time in 2012, with yearly additions touching above 7 gigawatts- GW. The expansion thereafter fell off the cliff, thereby reaching less than 2 GW between 2015 to 2017, however, since then has gone on to gradually see a surge again. It is well to be noted that in 2023, the buildout went on to exceed the government plans quite prominently, with an added capacity reaching over 14 GW rather than the already scheduled 9 GW, which was around twice as much as in the year before that, as per Fraunhofer ISE data.

It is well to be noted that in 2022, two German states went ahead and executed a solar PV obligation for specific construction projects, and thereafter, more states followed suit having similar legislation. Federal government, apparently, went ahead as well as proposed in its coalition agreement to make rooftop solar compulsory in terms of new commercial buildings and thereafter establish them as a rule to new private buildings. It also went on to agree on opening up certain more agricultural spaces and also moorland to solar PV installations. But, German Farmer’s Association- DBV, the agricultural industry lobby group, has gone ahead and warned that demand for new space when it comes to solar power installations could very well create acceptance issues among the landowners.

Apparently, at the same time, there are many citizens who happen to be eager to take part in the expansion of solar power, with more homeowners installing panels on their roofs, most often in mix with solar-powered batteries. Notably, in 2023, the overall number of installed solar power batteries went on to double to over one million units. Over 70% of the added capacity last year happened to come from the rooftop installations, with the homeowners responsible for 6.5 GW of the fresh installations, as per consultancy Rystad. Even the balcony-mounted solar panels have witnessed progress in popularity and regulatory reforms in 2023 aimed to facilitate their installation. A Yougov poll said that 68% of homeowners having suitable roof space opined that they intended to purchase a solar energy system, with 16% planning to do so this year.


After its rapid ascent to world leadership, and that too in less than a decade, Germany’s solar industry went on to face an even more quick dip after 2012. Competitors from beyond borders, especially from China, went ahead and offered solar panels at a much lesser rate than German manufacturers, while the support rates went on to be stable in spite of the panels’ country of origin. Subsequently, many investors went on to swap domestic for foreign suppliers in order to maximize returns, and at the same time, they left the newly expanded German industry bereft of its customers. Because of a parallel drop when it comes to guaranteed remuneration, solar PV expansion dipped by 80% between 2013 and 2015, while at the same time also doubling across the world during the same period.

The effects when it came to the German solar power industry were indeed harsh, as various major players like Q-Cells, Solon, as well as Conergy, which often invested large sums of money so as to ramp up production, were, as a matter of fact, forced to close down. Due to this, the number of jobs fell to just over 45,000 in 2016. SolarWorld, which happens to be one of the three biggest solar power companies across the world and, in fact, the last major solar panel producer from Germany, succumbed to Chinese competition and went on to file for insolvency a year after that.

But the business confidence within the sector has gradually increased in the past years and went on to be further bolstered due to the government’s 2022 announcement in order to aim for 100% renewables within the power system by 2035. Notably, as of 2021, the solar power sector went on to employ around 58,500 people in the country, as per the data by the Federal Environment Agency- UBA of Germany. It is well to be noted that in 2023, BSW Solar, a lobby group, said it anticipates a lasting solar boom in the country. But, a shortage when it comes to skilled labor as far as installing panels and several other factors were concerned could still go on to hamper the quick progress of solar power.

However, just around 2% of the solar PV modules that were installed in the EU in the years that have gone by happened to be produced domestically, whereas the vast majority of installations happen to be imported. Notably, the European solar power companies have gone to call for a full-fledged renaissance across the sector, arguing that environmental and labor standards across China are far less strict.


The cost curve when it comes to solar PV has been sliding downward consistently in the past years, and in 2020, the International Energy Agency- IEA went on to declare that the technology allows it to produce the cheapest electricity in history. Between 2013 as well as 2023 alone, solar PV costs have fallen by 87% and the cost of battery storage by 85%.

As per Fraunhofer ISE, the research institute, solar power has gone on to become the cheapest mode when it comes to power generation in Germany. Depending on the kind of installation as well as sunshine intensity at a particular location, coming with one kilowatt hour- kWh with solar panels may as well cost no more than 3.7 eurocents. An analysis by Sandbag, a British climate NGO, found that costs fell to the extent that new solar and even wind power installations in German auctions are not just cheaper as compared to new hard coal as well as gas plants, but at the same time also undercut the operation expense of the existing fossil power plants.

But the support payments for existing as well as new solar power installations still go on to have substantial costs for German power customers. In the final auctions of 2023, average support happened to be 5.17 cents per kilowatt hour- kWh for ground-mounted installations and 9.58 ct/kWh when it came to roof-mounted ones. However, numerous solar power users go on to install their panels sans participating in auctions.

It is well to be noted that many commentators in the past have gone on to lament that the policy effectively would mean that German power customers go ahead and subsidize the Chinese producers. Domestic suppliers were not able to compete because of rise in the labor costs as well as stringent environmental regulation on panel production. Others went on to laud the combination of balanced German investment support along with cheap Chinese labor as a catalyst when it came to cost reduction that aided the boost in capacity growth as well as paved the way for technological competitiveness.

Although, the German solar power companies keep struggling to compete with Asian manufacturers, they do have an edge in terms of research on the modules’ system integration as well as the execution of innovative applications is concerned. Foreign market leaders happen to be often focused on large-scale projects that help yield high returns but are most likely to only account for a phase of future growth, in which small-scale prosumers are anticipated to play an important role as well.

Companies have started to offer integrated solutions that enable the storage of surplus solar energy at home as well as to share or trade electricity with neighbors along with other prosumers around the clock. As prices when it comes to home storage technology have fallen quite sharply in the past years, they are set to be of benefit from a trend when it comes to self-supply and decentralized production, thereby making them less dependent on support rates.

But the fact is that the dipping panel prices, which have been a large driver when it comes to the latest surge within the solar power expansion, may as well hit a plateau. This could go on to allow other elements like greater productivity, sustainability as well as flexibility, and at the same time, gain in importance for researchers along with the investors. In spite of the future breakthroughs within panel development, German citizens have embraced solar power already as their favorite element of renewable energy generation.

It is worth noting that of the new installations added, large parts happened to be mounted on the roofs of private investors. Solar arrays having a capacity rating of less than 10 kWp comprised more than 60% of Germany’s overall installations in 2021, most of which happened to be installed by households as well as small businesses looking to become more independent of market power prices.