The Demand for Plug-in Solar Equipment in Germany Remains High

Industry News – August 3, 2023 | Sarah Hommel de Mendonça

German consumer interest in plug-in solar devices, also known as balcony solar systems, continues to exceed all expectations. Data from Germany’s Federal Network Agency shows that the number of registered installations in the country encreased from 137,000 in 2022 to 230,000 in the first half of 2023 alone. Industry insiders estimate the actual number, including undeclared devices, to be as high as 800,000.

Policymakers, associations and advocacy groups alike recognize that plug-in solar devices are fully unleashing society’s potential in contributing to a decentralized and renewable energy world. Balcony solar systems have brought solar power generation directly to residential consumers’ doorsteps. Not every installation is economically viable from the outset, but the benefits to society as a whole are undeniably high.

What is a balcony solar system?

Balcony solar systems or plug-in solar devices, also called mini PV systems, are photovoltaic systems with a maximum feed-in power of up to 600 watts (W) of inverter capacity. These PV modules can be installed anywhere outdoors, including balconies, roofs, exterior walls and gardens. Connection to the domestic power grid is usually achieved using a standard household plug, allowing electricity to be supplied directly to the household, where it is usually consumed in full. The registration of a balcony solar system that falls below what is known as the “de minimis limit” is much simpler than the registration of systems with a higher output.

The social and economic significance of plug-in solar energy

“Berlin wants to generate its own electricity” – such headlines could be seen on the front page of the Berliner Zeitung in May 2023. And it’s not just Berlin. All of Germany is now suddenly interested in plug-in solar devices. Complete systems are available at discount retailers and hardware stores – “Solar2Go”, so to speak. But why is this? Citizens feel empowered to do whatever they can to become self-sufficient and shield themselves from skyrocketing energy prices. They see plug-in solar power as another tool to lower their electricity bills. Many are also motivated to make a personal contribution to Germany’s switch to sustainable power generation.

The many benefits of balcony solar systems are obvious – the people take ownership of their energy and everyone can participate. Support for the energy transition is mobilized. Consuming self-generated energy relieves the burden on the power grids. Plus, technophobes are suddenly glued to their cell phones, using an app to track the yield of their mini PV installations. As a result, consumers have adjusted their utilization patterns and have begun using their household appliances, such as dishwashers and washing machines, around midday, when their installation generates the most electricity.

Balcony solar systems – economic viability and resource efficiency

Nevertheless, evidence is emerging that balcony solar systems should not be viewed solely through “rose-tinted lenses”. In a webinar, Georg Zachmann, senior fellow for energy and climate policy at Bruegel, highlights that the role of generation capacity from balcony solar is economically subordinate. This is because the energy yield is limited due to the confined space available and because the installations are not optimally aligned.

According to Zachmann, resource efficiency must also be included in the evaluation – for each balcony power system micro-inverter, there is a consumption of raw materials such as rare earths, for example, and the installed power price per kilowatt (kW) is significantly higher compared to large-scale installations.

Many German states subsidize balcony solar systems

Direct financial support for purchasing a mini PV system in Germany is particularly tempting at the moment – the subsidies amount to between 50 and 1,450 euros per system, depending on where the purchaser lives. Particularly generous funding is available in Heidelberg (up to 1,450 euros with a personal contribution of 50 euros) or Bonn (300 to 800 euros), for example.

Nevertheless, the state of Mecklenburg-Vorpommern is Germany’s leader in balcony solar systems, based on the number of installations in relation to the number of inhabitants. The largest number of installations is in North Rhine-Westphalia.

Grid feed-in from balcony solar systems

The topic of feeding electricity from balcony solar systems into the grid is still a source of confusion for consumers.

Currently, the grid operators and the core energy market data register anticipate no remuneration for grid feed-in using the simplified registration process. This means that if a balcony solar system generates more electricity than is consumed within the household, the remaining electricity is fed into the public power grid without the household receiving any financial compensation for it.

Balcony solar systems and backward-running meters

The exception is balcony solar systems operated in households with Ferraris meters that can run backwards. Currently, these are still banned in Germany, so the grid operator must replace the meters before the solar system can be put into operation. However, starting in 2023, such meters are expected to be permitted for a transition period of four months from registration until the grid operator replaces them (see Solar Package I ).

In light of this, consumers are rightly asking, “Why should I just give my electricity away? Isn’t it better to apply for a feed-in tariff?” The answer is yes, but consumers should carefully consider whether it is even worth it. This is because, since the capacity of plug-in solar systems is severely limited, the electricity generated is ultimately consumed directly within the household, in the vast majority of cases by appliances that are in continuous operation (refrigerator, wireless router, etc.).

On the other hand, applying for a feed-in tariff carries financial and administrative obligations with it – the grid operator must replace the meter at a cost of 100 euros and there is a metering point fee of 20 euros per year. Those costs have to be put into relation with a low feed-in tariff of only 8.2 euro cents per kilowatt hour (kWh).

Plug-in solar devices combined with battery storage systems

For those who nevertheless do not wish to give away their excess electricity, or who prefer to have the electricity they produce themselves available at all times, there are now plenty of balcony storage systems with capacities of up to 2.2 kWh on the market. The amount of solar power produced by the balcony solar system can be compared with a consumption measurement to establish whether a storage solution is economically worthwhile. This determines how much electricity is actually “given away” to the grid.

800 W balcony solar system

The Solar Package I strategy paper presented by the German Federal Ministry for Economic Affairs and Climate Action (BMWK) also provides for an early increase in the de minimis limit to 800 W inverter capacity. This is expected to be possible from January 2024. Currently, it is possible to install PV modules with an output of more than 600 W as a balcony solar system, so as to maintain optimal inverter utilization, which is limited to 600 W, at all times.

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