Deep dive Photovoltaics
Further Literature
*Some of the following developments were discussed in German language in the DIW Wochenbericht 33/2024 in more detail. However, the following data is more recent.
Global Development
No other electricity generation technology is currently growing as rapidly or attracting as much investment worldwide as solar photovoltaics (PV). The threshold of one terawatt (equivalent to one billion kilowatts) of globally installed capacity was already surpassed in 2022. By the end of 2024, this figure had reached around 1.9 terawatts, according to data from IRENA. While Europe — especially Germany — led in installed PV capacity until the mid-2010s, current growth is dominated by Asia, and in particular by China (figure above, left).
A comparison of installed PV capacity per person, based on data from IRENA and World Bank, clearly shows Germany's pioneering role at the beginning of the 2010s, but also a subsequent slump in expansion (figure above, right). In the 2020s, however, PV in Germany grew strongly again, most recently faster than ever before. In other countries, however, per capita growth was even faster. For example, the Netherlands has now overtaken Germany in terms of installed capacity per person and is only just behind Australia, which is very rich in sunshine. Belgium has also been able to increase its installed PV capacity very strongly in recent years. This means that the Netherlands, Germany and Belgium have installed more PV capacity per person than Spain, which has more sunshine. Even Poland, which is generally known for its coal-fired power generation, has recently seen such a strong increase in PV installations that it now has almost as much PV capacity per capita as Italy.
Installed Capacity
The following graph shows the development of installed PV capacity in Germany by installation type. Building PV systems (which are mostly rooftop installations) still make up the largest share of total capacity. Balcony power plants, due to their very small individual module capacities, account for only a very small portion of the overall installed capacity.
The following figure focuses on the segment of ground-mounted PV systems. It also shows an indicative target trajectory based on the Federal Government’s Photovoltaic Strategy, which assumes that half of future capacity additions will come from ground-mounted installations. Current developments fall significantly short of this target trajectory.
Net additions
... by installation type
Similar to the total portfolio shown above, the following figure shows the monthly net additions by type of system since 2017. The data basis for this is the Marktstammdatenregister (MaStR). In addition to the general upward trend, the figure shows that the expansion in almost all months was strongly driven by the building PV segment, which are predominantly rooftop systems. The figure also shows that the segment of small balcony/Plug-in PV systems has recently grown strongly, albeit from a very low level (double-click on the corresponding legend entry). It should be noted that only some of the balcony systems are likely to be correctly recorded in the market master data register.
The following figure additionally shows the share of total annual net additions by installation type since 2000. So far ground-mounted installation have never reached a share of 50% of total additions as envisioned by the Photovoltaic Strategy from 2026. In recent years, the share fluctuated around about one third.
... by installation size
The expansion can also be differentiated according to system size (select individual size classes by clicking on the legend). Ground-mounted systems have become increasingly larger in recent years. Systems with an output of at least five megawatts have recently accounted for the largest share of new installations.
In the case of building PV, smaller systems up to 25 kW accounted for the majority of monthly net additions in 2023 and 2024. These systems are likely to have been installed predominantly on the roofs of private households. However, the segment of larger and presumably mostly commercial building PV systems has recently grown significantly.
... by subsidy type
The German Network Agency provides data on net additions by subsidy type in the last twelve months. The following figure shows that the lion share of additions receive feed-in tariffs or premiums in accordance to the German Renewable Energy Sources Act. In most cases additions are small rooftop installations. Not even half as many additions receive subsidies resulting from a reverse auction, in which the lowest subsidy bids by installation owners win. Installations participating in these auctions are mostly large-scale ground-mounted plants. The share of installations not receiving any subsidies is rather small at this point. Such installations are e.g. marketed under power purchasing agreements (PPAs) or serve own consumption of larger industrial or commercial consumers. Lastly, this segment also includes some preliminary or unverified entries into the database. The Mieterstrom (tenant electricity) segment has been rather niche so far.
At the federal state level
... Existing PV systems and utilization of potential
The following figure also shows the total installed PV system inventory by federal state. The left-hand part shows that Bavaria has the highest PV capacity installed overall, with a ground-mounted share of around one-third. Baden-Württemberg and North Rhine-Westphalia follow at a considerable distance, followed by Lower Saxony and Brandenburg. Of these states, only Brandenburg has a larger share of ground-mounted systems. The installed PV capacity in the three city-states is very low.
However, the federal states' potential for utilizing solar energy also differs significantly due to differences in size, landscape, and structure. The right-hand part of the figure therefore compares the installed capacity with the state-specific potential, as determined in the Ariadne project by [Gerhardt et al.]. (2023)](https://ariadneprojekt.de/media/2023/11/Ariadne-Kurzdossier_EE_Potenziale-Akzeptanz_November2023.pdf). For photovoltaics on or in buildings, the utilization of potential does not differ greatly between most states. This means that the very high level of expansion of building PV in absolute terms in Bavaria is partly due to the particularly high potential in this state. Some states that are in the lower middle range in terms of absolute installed capacity for building PV are already utilizing their potential quite well in relative terms, for example Mecklenburg-Western Pomerania or Saxony-Anhalt. The city-states of Berlin and Hamburg are also at the bottom of the list in terms of potential utilization, which can be explained, among other things, by coordination problems with rooftop systems in multi-family buildings.
There are significantly larger differences between the states in the utilization of potential for ground-mounted systems. The basis for this analysis is the potential under the new Renewable Energy Sources Act (EEG), including suitable areas within 500 meters of highways and railways (Fig. 16 in Gerhardt et al. (2023)). Saarland performs particularly well here, followed by Brandenburg and Bavaria. Larger states such as Baden-Württemberg, North Rhine-Westphalia, and Lower Saxony, in contrast, have so far made relatively little use of their open space potential.
Tenders
The following figures provide an overview of the auctions for ground-mounted and rooftop PV capacity since the start of the respective auctions, based on data from the Federal Network Agency. The auctioned quantities, awarded quantities, and award values are shown. The latter determine the market premiums received by the systems and can be interpreted as the average minimum revenue per kWh required over the term. For better comparability, we present the award values here in real prices, deflated by the consumer price index.
In the area of ground-mounted systems, the auctioned capacity has increased significantly since the auctions began in 2015, especially since the start of the traffic light coalition government. Only a few tenders were signed. This means that there were rarely too few bids. This was particularly the case in 2022. The (real) award values have decreased significantly over time.
The following figure shows the annual tender and award volumes for ground-mounted systems in aggregate form.