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Germany’s Solar Boom Set to Continue in 2021

January 8, 2021


From PV panels to solar storage and solar collectors, rooftop installations grew 25% in Germany this year as due to increasing consumer demand for greater energy independence, lower solar tech prices, improved subsidy conditions and the rising popularity of electric cars. A further increase in solar technology expansion targets is expected to meet climate targets and avoid electricity shortfalls, according to the German Solar Association.

Germany saw a 25% increase in solar rooftop installations this year compared to 2019 and the trend looks set to continue next year, the German Solar Association (BSW) said Wednesday.

The growth in the rooftop sector was not limited to PV installations, according to BSW managing director Carsten Körnig.

“Whether solar cells, solar storage or solar collectors — this year they were virtually torn out of the hands of our industry,” Körnig said.

While the past year was also challenging for Germany’s solar industry, it was ultimately successful due to the removal of some market barriers, the BSW noted, stressing that no other source grew more strongly in electricity generation in 2020 than PV.

According to the BSW’s preliminary annual report, almost one in 10 kilowatt-hours consumed in Germany this year now stemmed from solar energy. While the German government aims to double solar power plant capacity by the end of the decade, energy and climate researchers consider a tripling to be necessary, the industry association stated.

In addition to greater climate awareness, the main drivers behind the solar boom include a striving by many consumers for more independence, significantly lower solar technology prices, improved subsidy conditions for the modernization of heating systems, and a switch to electromobility that is gaining momentum, the BSW noted.

Demand for solar technology in the heating sector also increased after years of decline. The BSW estimates that sales of solar heating systems picked up by more than 25% in 2020. In the first three quarters of the year, the Federal Office of Economics recorded a threefold increase in the number of applications for subsidies for solar thermal systems compared to the same period last year.

Good conditions for growth also make the solar industry confident for 2021 and the coming legislative period: “We expect the German government to significantly increase the climate targets and the pace of solarization before the German parliamentary elections, in agreement with the EU,” Körnig said. “By shifting a few energy policy levers, the installation pace could be doubled in a timely manner and the dependence on subsidies reduced.

“There is an overwhelming willingness to invest among private consumers and in the business community, even under pandemic conditions,” he added, stressing that unless the German government helps accommodate the growing demand next year, it will not only be putting climate targets in jeopardy but also voter support.

The BSW argues that a doubling to tripling of the annual PV expansion rate is necessary to prevent a power generation gap from opening up. “Market researchers expect this to occur in as little as two to three years as a result of existing decisions to phase out nuclear power and coal, as well as a foreseeable increase in demand for electricity,” the association said. Citing recent findings by the Fraunhofer Institute for Solar Energy Systems (ISE), the BSW said the expansion of photovoltaics — depending on consumer behavior — would have to be accelerated in the near future to around 10 to 15 GW per year in order to achieve the climate targets currently being raised at the EU level, which would see a CO2 reduction of 55% by 2030. The BSW expects the market to grow by 4.6 to 4.8 GW in 2020, compared to around 3.8 GW in 2019.

“Swift and consistent implementation of scientific recommendations could be decisive for the success of the parties in the upcoming German parliamentary elections, not only in health policy but also in climate policy,” the BSW stressed, citing the results of a recent survey conducted by research firm YouGov on behalf of BSW. Nearly 75% of the more than 2,000 people surveyed said climate policy could become very important (41 percent) or important (32 percent) for their own election decision from today’s perspective. “The expansion of solar energy and other renewable energy sources is seen as by far the most important climate protection measure,” the BSW added.

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