In the face of soaring energy prices and the impacts of the Ukraine war, German industrial companies are increasingly turning to solar power to reduce their electricity costs and carbon emissions.
Philip Matthias, a businessman in the eastern German state of Thuringia, recently convinced his father to invest 2.3 million euros in a solar power project for their metal products factory. Initially skeptical of the substantial investment, Matthias’ father ultimately decided to nearly double the project’s capacity after crunching the numbers. The solar installation is expected to pay for itself in just 7.5 years, thanks to a feed-in tariff that guarantees a set price for the renewable energy produced.
Across Germany, companies are being encouraged to go solar by favorable policies and incentives, as the country aims to source 80% of its energy from renewables by 2030. While Germany already has the largest installed capacity of solar and wind power in Europe, small and medium-sized businesses have yet to fully benefit from lower electricity prices due to high grid fees and taxes. By generating their own solar power, companies can avoid these additional costs.
As electricity prices in Germany show no signs of dropping, businesses are increasingly recognizing the financial viability of installing solar panels. According to Marie-Theres Husken, an energy expert at the BVMW association for small and medium enterprises, companies consumed around 69% of Germany’s national electricity in 2023, making solar an attractive option to help manage rising energy expenses.