Solar Energy in Germany Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Germany Solar Energy Market Analysis

The Germany Solar Energy Market size is estimated at 115.12 gigawatt in 2025, and is expected to reach 266.73 gigawatt by 2030, at a CAGR of 18.3% during the forecast period (2025-2030).

Germany's solar energy sector has emerged as a cornerstone of the country's energy transition strategy, with renewable energy sources contributing significantly to the national power mix. As of 2022, clean energy constituted 40.9% of Germany's power mix, highlighting the country's commitment to sustainable energy solutions. The photovoltaics sector has demonstrated remarkable progress, generating 60.8 terawatt-hours (TWh) of electricity in 2022, accounting for 11% of the nation's total electricity consumption. The German government has established ambitious targets through the EEG 2023, aiming to achieve 215 gigawatts peak (GWp) by 2030 and 400 GWp by 2040, demonstrating a clear long-term vision for solar energy expansion.

The market has witnessed significant technological advancements and infrastructure developments throughout 2023. A notable milestone was achieved in September 2023 when Germany inaugurated its largest solar rooftop installation at the METRO logistics site in Marl, featuring two installations totaling 18 MWp capacity and covering an area equivalent to 14 football fields with 43,000 solar photovoltaic modules. Additionally, the Federal Ministry of Economic Affairs and Climate Protection (BMWK) has implemented regulatory reforms to streamline the grid connection process for rooftop solar PV systems up to 500 kW, facilitating faster adoption across commercial and private properties.

The industry has experienced substantial private sector engagement and innovative project developments. In 2023, Emeren Group Ltd successfully sold an 11.5 MWp PV project to the Swiss-based MET Group, demonstrating the market's attractiveness to international investors. The project, located in Kenzlin, Mecklenburg-Western Pomerania, is scheduled for commercial operations in the second half of 2024. Furthermore, companies like Solyco have pioneered advanced solutions, deploying vertical PV rooftop systems with glass-glass bifacial tunnel oxide passivated contact (TOPCon) modules, showcasing the market's technological sophistication in solar technology.

The regulatory landscape has evolved significantly to support market growth, with several German federal states implementing mandatory solar installation requirements. As of January 2023, states including Baden-Wuerttemberg, North Rhine-Westphalia, Berlin, Hamburg, Rhineland-Palatinate, Bavaria, Schleswig-Holstein, and Lower Saxony have adopted laws mandating solar panel installations on new buildings. These regulations vary by state but generally apply to new commercial buildings and, in some cases, residential properties. For instance, Baden-Wuerttemberg, which ranks second in installed solar power capacity with 7.8 GW, has extended its mandate to existing buildings undergoing roof renovations, demonstrating a comprehensive approach to solar energy integration.

Germany Solar Energy Market Trends

Increase in Prices of Electricity Procured from Conventional Mechanisms

The escalating cost of electricity from conventional sources has emerged as a significant driver for Germany's solar energy market. In a striking demonstration of this trend, household electricity prices in Germany witnessed a substantial increase of 25.8%, rising from EUR 0.3279 per kilowatt-hour in June 2022 to EUR 0.4125 per kilowatt-hour in June 2023. This sharp rise in conventional electricity costs has created a compelling economic case for transitioning to solar power, particularly as solar technology becomes increasingly cost-effective. The situation has been further intensified by the German Energy Ministry's March 2024 announcement regarding the shutdown of seven coal-lignite-fired power plants, aligning with the country's goal to completely phase out coal power by the end of the decade.

The impact of high electricity prices has been particularly severe on energy-intensive industries, including the steel, cement, food, and beverage sectors, forcing many facilities to either reduce production or cease operations entirely. This challenging situation has highlighted the critical importance of integrating renewable energy sources, especially solar power, into Germany's energy mix. In response to these market conditions, the government has implemented supportive measures, including an increased feed-in tariff for solar energy power plants up to 750 kW, particularly benefiting residential areas. This initiative not only encourages the installation of rooftop solar PV systems but also enables end-consumers to generate revenue by feeding excess solar electricity back into the conventional grid.

The German government's commitment to addressing these challenges is evident in its ambitious Solar Package initiative, which aims to install 215 GW of solar installation capacity by 2030. This strategic focus on solar energy development is further reinforced by recent industry developments, such as Uniper's September 2023 announcement to establish a 300 MWp photovoltaic plant in Elsfleth, Germany, covering approximately 281 hectares. These developments, coupled with the government's efforts to streamline bureaucratic processes for solar power installations, demonstrate the market's strong response to rising conventional electricity costs and underscore solar energy's growing role as a cost-effective alternative to traditional power sources.

Segment Analysis: By Type

Solar Photovoltaic Segment in Germany Solar Energy Market

The solar photovoltaic (PV) segment dominates the German solar energy market, commanding approximately 99.9% of the total market share in 2024. This overwhelming market dominance is driven by several key factors, including the government's ambitious solar package that aims to accelerate PV expansion to reach 215 GW by 2030. The segment has witnessed remarkable growth due to declining costs of solar technology, particularly solar panels, making them increasingly appealing to consumers and businesses. The steady decrease in solar equipment prices has enhanced the competitiveness of solar power against traditional energy sources. In 2023, the German government approved significant measures to boost adoption, including reducing the value-added tax (VAT) to 0% for residential PV systems up to 30 kW and providing tax exemptions to operators of small PV systems. The segment is projected to maintain its strong growth trajectory at a rate of around 17% from 2024 to 2029, driven by supportive government policies, rising energy prices, and continuous technological advancements in solar PV system technology.

Concentrated Solar Power Segment in Germany Solar Energy Market

The Concentrated Solar Power (CSP) segment maintains a minimal presence in the German solar energy market, with a market share of approximately 0.1% in 2024. This limited market penetration is primarily attributed to factors such as high infrastructure costs, technological instability, and limited resource potential in the country's geographical context. Despite these challenges, the segment has seen some interest from industry stakeholders, particularly after the European Commission's initiative to provide grants worth USD 0.5 million for developing advanced CSP technologies. The German Association for Concentrated Solar Power (DCSP) continues to advocate for developing CSP plants, especially for industrial applications, recognizing their potential in providing dispatchable power and contributing to the country's renewable energy goals.

Segment Analysis: Application

Commercial and Industrial Segment in Germany Solar Energy Market

The commercial solar and industrial (C&I) segment dominates the German solar energy market, holding approximately 44% market share in 2024. This significant market position is driven by several factors, including favorable regulatory environments and financial incentives that encourage solar PV system installations. The segment's growth is particularly notable as several federal states have made solar installations mandatory on commercial building roofs, with states like Baden-Wuerttemberg and North Rhine-Westphalia leading the implementation. The integration of solar storage technologies has further strengthened the segment's position, allowing businesses to optimize their self-consumption and reduce dependence on grid electricity. Additionally, the declining costs of solar technology, particularly solar panels, have made solar installations increasingly attractive for businesses looking to reduce their operational costs and enhance their environmental credentials.

Residential Segment in Germany Solar Energy Market

The residential solar segment is emerging as the fastest-growing sector in the German solar energy market, with a projected growth rate of approximately 25% from 2024 to 2029. This remarkable growth is being driven by several key factors, including rising energy costs and supportive government policies. The segment's expansion is further supported by the German government's recent measures to increase rooftop PV system adoption, including the reduction of value-added tax (VAT) to 0% for residential systems up to 30 kW and various tax exemptions for small PV system operators. The integration of energy storage technologies, particularly battery storage systems, has enhanced the segment's appeal by allowing homeowners to maximize self-consumption and achieve greater energy independence. The segment is also benefiting from technological advancements in Building-Integrated Photovoltaics (BIPV) and the rising adoption of plug-in solar systems, which provide flexible solutions for tenants and homeowners alike.

Utility Segment in Germany Solar Energy Market

The utility segment continues to play a crucial role in Germany's solar energy landscape, focusing on large-scale solar energy projects designed to generate electricity for the grid. This segment has been particularly instrumental in helping Germany achieve its renewable energy targets and transition towards a more sustainable energy future. The utility segment benefits from economies of scale and increasingly efficient project development processes, while also contributing significantly to the country's grid stability and energy security. Recent developments in the segment include innovations in project financing models, improved grid integration capabilities, and the emergence of hybrid solar-storage projects that enhance the reliability of solar power generation.