Compiled by Dr. Harry Wirth, Fraunhofer ISE | Last updated: February 2 ,2021
Germany is leaving the age of fossil fuel behind. In building a sustainable energy future, photovoltaics is going to have an important role. The following summary consists of the most recent facts, figures and findings and shall assist in forming an overall assessment of the photovoltaic expansion in Germany.
The annual target of the German Federal Government for PV capacity increase of 2.5 GW was exceeded in 2020, but the goals of the energy transformation are still far away.
In order to cover all of our energy needs from renewable energies (RE), a massive expansion of the installed PV power is necessary, along with a number of other measures. More recent model-based scenarios calculate a reduction of energy-related greenhouse gas emissions by at least 90% in relation to 1990, with a PV expansion corridor of 130-650 GWp nominal capacity ([Prog], [BCG], [ESYS], [ISE11], [UBA8], [IRENA], [ISE12]). The scenarios make different assumptions about boundary conditions, e.g. for energy source imports and questions of acceptance. Based on the scenarios "reference" and "inacceptance" [ISE12], a magnitude of 500 GWp installed PV capacity seems to be plausible.
If we calculate a PV expansion to 500 GWp by 2050, an average of 15 GWp of PV will have to be added annually. Increasingly, old systems must also be replaced. These replacement installations are currently still of little importance, but they will increase to the same order of magnitude of 15 GWp per year when fully expanded, assuming a lifetime of 30 years.
The German Renewable Energy Sources Act [EEG2021] defines the goal of making the electricity generated or consumed in Germany greenhouse gas neutral by 2050 at the latest. An intermediate target of 2030 is set at a share of renewable energies (RE) of 65 percent of gross electricity consumption. This requires an average annual PV addition of at least 5-10 GWp, depending on the development of electricity demand and the expansion of wind power ([AGORA1], [BEE]). The German Renewable Energy Sources Act [EEG2021], on the other hand, sets the PV expansion target at 100 GWp, corresponding to an average addition of just under 5 GWp per year.
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Yes.
According to initial projections, PV covered 9.3% of gross electricity consumption in Germany in 2020, with electricity generation of 50 TWh [BDEW3]; all renewables (RE) combined came to 46% (Figure 1). Gross electricity consumption includes grid, storage, and self-consumption losses (Section 24.8). On sunny days, PV electricity can temporarily cover more than two-thirds of our current electricity consumption. At the end of 2020, PV modules with a nominal capacity of 54 GWp were installed in Germany [ISE4], distributed over 2 million systems [BSW1].
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It depends on the reference point.
The cost comparison with fossil and nuclear power generation is made more difficult by the fact that their external costs and risks in terms of environmental, climate and health damage are largely not taken into account in pricing ([UBA3], [FÖS1], [FÖS2]). Hiding these external costs represents a massive subsidy to the energy sources involved (Section 5.2).
The marginal costs for nuclear power are in the order of 1 €-ct/kWh, for coal-fired power 3-7 €-cts/kWh, for gas-fired power 6-9 €-cts/kWh. The fixed costs of power generation (e.g. investments, capital) are added on top of this. The marginal costs essentially cover the provision of the fuel, but not the neutralization of the radiating waste or polluting emissions (CO2, NOx, SOx, Hg).
New MW power plants produce PV electricity at a cost of 3-5 ct/kWh in Germany, provided that the volatile electricity is sold in full. The lowest bid price to date for power plants up to 10 MW is 3.55 ct/kWh. Newly built, larger power plants that are operated directly by utilities outside the German Renewable Energy Sources Act (RES) or supply their electricity via offtake agreements are likely to produce at costs well below 4 ct/kWh. Newly constructed, smaller power plants have higher LCOE, in the order of 10 ct/kWh for rooftop installations of a few kW nominal capacity. Older PV power plants produce solar electricity much more expensively due to the previously very high investment costs.
To promote the energy turnaround and to stimulate investments in PV systems of various sizes, in the year 2000 the instrument of the German Renewable Energy Sources Act was created. It is intended to enable the plant operator to run the plant at a reasonable profit with a guaranteed purchase. Furthermore, the German Renewable Energy Sources Act aims at continuously reducing the LCOE from RE by securing a substantial market for RE systems (see section 4.1).
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A subsidy is defined as a benefit from public funds. Up to and including 2020, the subsidy for PV electricity generation did not come from public funds, but from a selective consumption levy, which applies also to self-produced and self-consumed PV electricity. Energy consumers make a compulsory contribution for the - necessary and approved - transformation of our energy system. This interpretation is also supported by the European Commission. The amount of the levy also does not correspond to the total remuneration, but to the differential costs. The cumulative costs paid out for PV power fed into the grid up to and including 2020 amounted to ca. 100 billion euros [BMWi5]. In 2021, for the first time there will be a contribution from the Federal Government's Energy and Climate Fund (section 4.6). The revenues of the Energy and Climate Fund come from emissions trading and from federal subsidies, thus there is a partial subsidy.
To calculate the EEG surcharge, the financial benefits of PV power are determined according to the market clearing price. By this method, the benefits of PV power are underestimated systematically. For one, PV power has long been having the desired effect on this market price, namely that of driving it downwards (see section 4.3). Second, the market price leaves out the heavy external costs of fossil fuel and nuclear power production (Section 5.2). Considering total costs of fossil fuel and nuclear power production of ca. 10 €-cts/kWh, the additional costs of the PV feed-in tariff decline so quickly that the first intersection point occurs already in 2013. The differential cost decrease to zero and thereafter are negative.
In this way, the development of renewable energy will secure a long-term supply of energy at a reasonable cost, since it is clear that we cannot afford fossil and nuclear energy for much longer. Our industry needs a supply perspective, as do households.
The electricity policy can learn from the bitter lessons experienced in housing construction policy. Because comprehensive measures to renovate the existing building stock have not been undertaken to date, many low-income households must apply for social funds to be able to pay for their heating fuel. Some of this money flows to foreign oil and gas suppliers to release huge amounts of CO2 as a by-product with the heat generated. What would be the price to pay if the German energy transformation fails? Without knowing this figure, it is difficult to make a statement as to the total costs required to transform our energy supply system.
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No, the increased export surplus comes primarily from coal power plants.
Figure 16 shows the increase in electricity exports since 2011 [ISE4]. The monthly values of the Energy Charts (www.energy-charts.de) show that the export surplus was conspicuously high in winter, i.e. in months with a particularly low PV power production. The average export price per kWh of electricity differs slightly from the average import price.
The fact that the German power plant park is increasingly producing for export should also be related to the low production costs for coal electricity, in particular the low CO2 certificate prices (Section 5.2) of recent years.
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Yes.
In principle, small PV systems can generate returns both via the EEG remuneration for feeding electricity into the grid and via the reduction in electricity consumption thanks to self-consumption. Due to the sharp drop in prices for PV modules, attractive returns are possible. The Solar Cluster Baden-Württemberg has estimated returns of up to 5% for small systems without battery storage and with self-consumption of around 25% [SCBW].
Self-consumption becomes more worthwhile, the greater the difference is between the cost of delivering PV electricity and the LCOE of the PV system. For systems without energy storage, the self-consumption is dependent on coinciding supply and demand profiles. Independent of the system size, households generally consume 20-40 % of their self-produced electricity [Quasch]. Larger systems increase the percentage of PV coverage for the total power, however, reduce the percentage of self-consumption. Commercial or industry consumers achieve a particularly high rate of self-consumption as long as their consumption profile doesn’t collapse on the weekends (e.g. Refrigerated warehouses, hotels and restaurants, hospitals, server centers, retail). Energy storage and technologies for energy transformation offer a large potential for increasing the self-consumption (compare Section 18.3).
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No, however over the last few years Germany lost many jobs in the PV industry.
In 2018, the PV industry employed 24,000 people in Germany [BSW]. By comparison, about 21,000 people still worked in lignite mining and lignite-fired power plants in 2015 [ÖKO1]. Businesses from the following sectors contribute to the German PV industry:
In 2019, the German inverter manufacturers held notable shares of the global market with approx. 10%, silicon manufacturers (Wacker), silver paste manufacturers (Heraeus) and manufacturers of production systems.
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The PV capacity operated in Germany is predominantly owned by private individuals, farmers and commercial enterprises (Figure 17). No other power generation technology enables such a high degree of decentralization and participation. The traditional electricity suppliers, especially the "big four" (E.ON, RWE, EnBW and Vattenfall), have been reluctant to invest in PV for a very long time. Where did this reluctance come from?
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Looking back at previous numbers, Figure 20 shows that it took time for renewable energy and energy efficiency to become a focal point of energy research.
In 2019, the German government has invested 1.15 billion euros in energy research. Almost 100 million euros of this was invested in the funding of photovoltaic research (Figure 21).
By way of comparison: even after the decision to phase out nuclear power, European treaties are still forcing Germany to finance the EURATOM program with high double-digit million amounts each year, in 2019 with around 80 million euros [FÖS4]. Most of the EURATOM funds are spent on fusion research.
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Most solar power systems in Germany are connected to the decentralized low-voltage grid (Figure 21) and generate solar power consumption.
As a result, solar power is mainly fed in decentrally and hardly demands to expand the German national transmission grid. High PV system density in a low voltage grid section may cause the electricity production to exceed the power consumption in this section on sunny days¸ due to the high simultaneity factor. Transformers then feed power back into the medium-voltage grid. At very high plant densities, the transformer station can reach its power limit. An even distribution of PV installations over the network sections reduces the need for expansion.
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No. The Energy Returned on Energy Invested (ERoEI or EROI) describes the relationship between the energy provided by a power plant and the energy spent on its construction. Energy payback time or energy payback time (Energy Payback Time, EPBT) indicates the amount of time a power plant must run to provide the amount of energy invested.
Harvest factor and energy payback time of PV plants vary with technology and plant location. A study by Fraunhofer ISE on PV power plants with current PV technology (monocrystalline PERC modules) has determined energy payback times of about one year for European production and operating sites. With a life span of 25-30 years, this results in yield factors greater than 20.
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Yes, without any significant conflicts with agriculture.
When analyzing potentials, a distinction is made between a theoretical, a technical and an economic-practical, feasible or exploitable potential. The theoretical potential considers the maximum possible implementation of a technology on the basis of the total supply (physical rough calculation). The technical potential is lower because it takes basic technical constraints into account (technical rough calculation). The economic-practical potential takes into account all relevant boundary conditions, in particular legal (including nature conservation), economic (including infrastructure), sociological (including acceptance), as well as competing uses (e.g. solar thermal energy and PV on roofs). Different sources draw somewhat different boundaries between the categories.
A study commissioned by the German Federal Ministry of Transport and Digital Infrastructure estimates the potential for expansion of non-restriction open spaces for PV ground-mounted systems to 3164 km2 in Germany [BMVI]. With an area consumption of 1.4 ha/MWp according to the current state of the art [ZSW], these areas offer a technical potential of 226 GWp.
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Yes. The free scalability of PV power plants enables decentralized expansion, even down to so-called "balcony modules" ("plug-in PV") with a few hundred watts rated power. The high number of more than 1.7 million PV systems in Germany, of which about 60% are small systems with outputs below 10 kW, shows that extensive use is made of these technical possibilities.
According to a representative survey by Lichtblick, solar systems are among the most popular power plants [Licht2]. Figure 32 shows the distribution of the answers to the question "If you think of the construction of new plants for energy generation in Germany: What types of plants should the focus be on?”
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The efficiency of PV systems as energy converters is comparatively low, but the sun shines for free.
The nominal efficiency (see section 24.2) of commercial wafer-based PV modules (i.e. modules with silicon solar cells) in new production has increased in the last few years by approx. 0.3 percentage points per year to average values of about 20% [ITRPV]. They provide a nominal output of 200 W; top-class modules are 10% above this value.
Since additional losses occur during operation, PV plants do not actually operate at nominal module efficiency. These effects are combined in the performance ratio (PR). A well-designed PV plant installed today achieves a PR of 80–90 percent throughout the year. This takes into account all losses incurred as a result of higher operating temperature, varying irradiance conditions, dirt on the solar modules, line resistance, conversion losses in the inverter and downtime. Inverters convert the direct current (DC) generated by the modules to alternating current (AC) for grid feed-in. The efficiency of new PV inverters currently stands close to 98 percent.
In 2018, the average household electricity consumption for electrical appliances, lighting, hot water (for hygienic purposes) and domestic heating was 1.6 MWh per household member [DESTATIS]. Average values for 1-person households are slightly higher per capita, for multi-person households significantly lower. On average, PV roof systems achieve 910 full load hours [TSO] (Section 15.3.). From a south-facing and moderately inclined roof surface of a house, 22 m2 are thus sufficient to generate an amount of electricity with 12 PV modules of 360 W, which corresponds to the average annual electricity demand of a family (4 MWh).
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Yes.
While PV systems do not release CO2 during operation, a holistic view must also take into account the manufacture of the system and its disposal. If one considers the life cycle of a photovoltaic roof system operated in Germany, plausible estimates lie between approx. 50 (Figure 39, [EnAg]) and 67 g CO2 eq./KWh solar power [UBA7]. With the spread of new technologies such as diamond wire saws, greenhouse gas emissions from PV production have decreased significantly in the recent past.
By expanding RE, the CO2 emission factor for electricity generation in Germany could be reduced to 474 g CO2/kWh by 2018 (Figure 40). The expansion of RES has reduced the CO2 emission factor for the German electricity mix from 764 g CO2/kWh in 1990 to 474 g CO2/kWh in 2018 (Figure 38). The emission factor describes the ratio of the direct CO2 emissions of the entire German electricity generation (including electricity export) to the net to electricity consumption in Germany [UBA6].
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No, not in the near future.
PV and wind power may currently be capable of reducing the use of fossil fuels, imported energy consumption and CO2 emissions but until considerable storage capacities for electricity or hydroelectric storage facilities are available in the grid, they are not capable of replacing capacities. Calm, dull winter days, when power consumption is at a maximum and no solar or wind power is available, present the most critical test.
Despite this, PV and wind power are increasingly colliding with conventional power plants with slow start-up and shut-down processes (nuclear, old lignite power plants). These power plants, which are almost only capable of covering the base load, must be replaced by flexible power plants as quick as possible. The preferred power plant choice is multifunctional electrically powered CHP plants fitted with thermal storage systems (Section 18.3.6).
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Yes, to the extent that we adapt our energy system and the energy-related structures to the requirements of the energy transformation.
Energy demand and supply
The traditional energy industry promotes fossil and nuclear energy sources (primary energy), converts them and prepares them for end users (Figure 42).
There are dramatic efficiency deficits in conversion and final energy consumption (cf. Section 18.3.3). Our future energy demand is by no means the same as today's primary energy consumption, neither in terms of quantities nor in terms of energy carriers.
Until now, Germany has been highly dependent on energy imports ((Figure 43), associated with the risk of volatile prices, political interference by mining and transit countries, and the risk of disruptions in raw material logistics, for example due to low water in rivers.
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Yes, if we want to avoid new dependencies in energy supply.
As the energy transformation progresses, Germany will leave behind the «fossil fuel” century, in which we spent 90 billion euros for oil and gas imports annually and thus financed authoritarian governments.
The energy transformation offers the chance to escape from this dependency. Not only does the sun also shine in Germany but Germany has also made decisive contributions to technology development in the solar sector. Despite the slowdown in national expansion of Germany’s solar market, the German PV sector with its material manufacturers, engineers, component manufacturers, R&D institutes and training facilities has held onto its leading position worldwide.
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Yes, with focusing on the energy transformation process.
The current market mechanisms would provide too little incentive for long-term investment in the energy transformation without the support of an EEG. The main reasons is the sectoral gaping pricing of CO2 emissions, which fluctuates with the stock market and is much too low overall. A socially balanced national carbon tax, such as that introduced in Sweden in 1991 and in Switzerland in 2008 as a "tax levy", can bridge these shortcomings.
As a rule, PV power plants of all sizes require a grid connection in order to deliver electricity that can neither be consumed on site nor saved economically. In order to maintain the diversity of actors involved in PV generators, a legal framework must entice the grid operator to make connections easily.
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Often yes, so PV modules do not belong in the residual waste.
The silicon wafer-based modules (more than 90 percent of the market share) often contain lead in the cell metallization layer (around 2 grams of lead per 60-cell module) and in the solder used (approximately 10 grams of lead). Lead, a toxic heavy metal, is soluble in certain, strongly acidic or basic environments, and lamination in the module does not permanently prevent mass transfer [IPV]. In wafer-based modules, lead can be completely substituted by harmless materials at low additional costs. Some module manufacturers use backsheets containing fluoropolymers, for example polyvinyl fluoride
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Wafer-based modules do not require any raw materials which could become limited in the foreseeable future. The main components by weight are glass, aluminum, polymers and silicon, with silicon and aluminum among the most important components of the earth's crust by weight. Most critical is silver consumption for cell production. The PV industry currently consumes about 1,500 metric tonnes of silver annually, corresponding to almost 6 % of production in 2020. The silver on the solar cell can be technically substituted by copper to the greatest possible extent, and some manufacturers already use copper.
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Yes, as is the case with all electric installations.
Certain faults in the components of PV plants that conduct electricity may cause electric arcs to form. If flammable material, like roofing material or wood, lies in close vicinity to these arcs, then a fire may break out depending on how easily the material ignites. In comparison to AC installations, the DC power of solar cells may even serve as a stabilizing factor for any fault currents that occur. The current can only be stopped by disconnecting the circuit or preventing irradiation reaching any of the modules, meaning that PV plants must be constructed carefully.
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Fraunhofer Institute for Solar Energy Systems ISE