Funding for solar systems: waiver or turning point for green electricity?

Funding for solar systems: waiver or turning point for green electricity?

Amid the ongoing discussion about the future of solar energy in Germany, Benjamin Frank, boss of the Dresden solar company Solarwatt, expresses his opinion that the promotion of solar systems is no longer absolutely necessary. Despite his own solar system, which benefits from the funding policy, he says he could get by without these funds. The current subsidy is 25 percent, support that helps him make ends meet economically - especially in times when he does not need the electricity he generates himself. Nevertheless, he sees the profitability of his system as quickly achievable, although it could take longer for new systems to pay off.

The status quo stipulates that the state currently pays private individuals just under eight cents per kilowatt hour fed into the grid. This feed-in tariff is seen as essential for the expansion of green electricity in Germany. If the funding actually ceases, this could have a negative impact on demand for solar systems, which experts believe would be problematic. Andreas Bett, a representative of the Fraunhofer Institute for Solar Energy Systems, warns of a possible market collapse. Such a decline could not only lead to workforce reductions among installers, but also have significant economic consequences and impacts on the energy transition.

Climate goals and funding instruments

The discussion about solar funding is closely linked to Germany's climate goals, which call for a switch to renewable energies, especially solar energy. The funding instruments include the EEG feed-in tariff, KfW development loans, tax breaks and regional subsidies. These funding instruments are aimed at various target groups, including homeowners, tenants, companies, cooperatives and municipalities.

The EEG feed-in tariff ensures a fixed compensation rate for the solar power fed in over a period of up to 20 years. The feed-in tariff rates for 2025 are currently set as follows:

In addition, KfW development loans offer low-interest loans for photovoltaic systems, electricity storage and charging infrastructure. Since January 1, 2023, consumers have benefited from a tax advantage that provides 0% VAT on certain solar systems. In addition, there are additional funding programs in various federal states.

Future of solar funding

However, the solar industry is facing challenges. Bureaucratic hurdles, technical requirements and frequent application errors continue to represent major obstacles. A structured application procedure and an approval process, which usually takes 4 to 6 weeks, are necessary in order to access the funding. Experts recommend obtaining financing commitments in advance, including regional programs and seeking specialist advice.

The future of solar funding is viewed as critical, with the aim of further developing the funding system by 2030. A particular focus should be on increasing efficiency and innovative technologies. It remains to be seen how the market will react to the current debate and whether the current funding policy will be adapted to the changing needs of the industry.

For more information on developments in the solar industry you can MDR and SurgePV visit.