Reiche’s Energy Transition Reality Check: Current Challenges for Photovoltaic and Stor-age Companies

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In the Intersolar Europe webinar 'Reiche’s Energy Transition Reality Check' (Reiches Energiewende-Realitätscheck), experts from the German Solar Association (BSW-Solar) discussed the current challenges facing the solar energy and energy storage industries in connection with the current direction of Germany’s Federal Ministry for Economic Affairs and Energy (BMWE). It became clear that the long-term growth trajectory is currently being increasingly slowed by economic and regulatory uncertainties.

Carsten Körnig, CEO of BSW-Solar, noted that demand in the building sector has noticeably weakened compared to last year, though it remains significantly higher than the demand be-fore the energy crisis. The weak state of the economy, political uncertainty and delays due to a lack of state aid approvals – such as for Solar Package I – hampered investments and slowed down the implementation of planned projects. While Germany has so far exceeded its gov-ernment-set expansion targets and reached the 100 gigawatts (GW) mark of installed PV ca-pacity by the end of 2024, Körnig emphasized that achieving the second half of the 215 GW expansion goal by 2030 is far from guaranteed.

Regulatory roadmap: Cost efficiency in expansion and EU specifications

Christian Menke, Policy and Solar Technology Officer at BSW-Solar, put the current energy pol-icy situation in context with the meta-study Monitoring Report on the Energy Transition, which was recently presented by the Federal Ministry for Economic Affairs and Energy (BMWE) and Minister Katherina Reiche (CDU).

He emphasized that the minister remains committed to the expansion goal of 80% renewables by 2030, but pointed out the contradictions between the minister’s 10-point plan and the rec-ommendations of the monitoring report.

• Underestimation of power consumption growth: The monitoring report considers a range of 600–700 terawatt-hours (TWh) to be reliable, rather than the current 750 TWh as specified in the Renewable Energy Sources Act (EEG). While the minister considers 600 TWh to be the maximum value, analyses by RES industry associations predict that power consumption will rise to around 700 TWh. The EEG expansion goals were derived directly from expected power consumption, which could trigger discussions about ad-justing expansion goals.
• Framing it as a “focus on cost efficiency,” the minister – who has not yet reached agreement within the coalition – has announced cuts to EEG subsidies for renewable energies, while simultaneously, introducing new subsidy and market mechanisms for fossil fuel power plants, carbon capture and storage technologies (CCS) and blue hy-drogen.

Christian Menke also addressed the increasingly challenging market environment for PV in Germany, characterized by falling market values and a growing number of hours with negative energy exchange prices – 576 negative hours, as of October 31, 2025. In the webinar, he also explained the far-reaching implications of the EU electricity market reform. Starting in 2027, all new subsidized plants above 200 kilowatts (kW) will be subject to mandatory revenue cap mechanisms (e.g., two-sided CfDs or equivalent models). The current absence of a revenue cap, due to the EU having not yet granted state aid approval, is continuing to delay key funding components of Solar Package I. The industry does not expect final clarification until the major energy law amendment in 2026. Until then, a significant portion of the subsidy-related changes in Solar Package I will remain in a transitional phase.

Rooftop solar PV as a key systemic pillar

The webinar devoted significant attention to the role of private home installations and rooftop solar PV – a market segment which is currently declining. Subsidies for residential PV systems have been criticized due to the Federal Ministry for Economic Affairs and Energy’s (BMWE) fo-cus on maximizing cost efficiency in funding renewables. Benedikt Fischer, Solar Technology and Legal Affairs Officer at BSW-Solar, countered that small and medium roof-mounted sys-tems are indispensable for the energy transition, due to benefits such as high self-consumption and prosuming, grid congestion management, cost efficiency and their contribu-tion to public acceptance of the energy transition. He also pointed out the risk of significantly longer payback periods (up to twice as long) if EEG subsidies were removed. A representative BSW survey consequently showed that only four out of ten interested parties would still install a rooftop PV system without economic incentive.

Fischer outlined “to-dos” for the residential systems sector, including improving direct market-ing, for example through an accelerated smart meter rollout. The association opposes manda-tory direct marketing of small PV systems, arguing that the technical and economic prerequi-sites are currently not in place.

He also called for legal certainty for customer installations, noting that district and tenant power solutions are subject to considerable legal uncertainty following a ruling by Germany’s Federal Court of Justice (BGH), which is slowing the growth of this market segment.

Storage systems between growth and regulatory gaps

Battery storage systems were also a topic of the webinar. Germany currently has around 24 gigawatt hours (GWh) of installed storage capacity. However, as Thomas Seltmann, Solar Technology and Storage Officer at BSW-Solar, explained, its systemic benefits remain limited due to regulatory gaps.

Progress – such as grid charge exemptions and tax relief – is welcomed, but the fundamentals – such as digital metering technology (AMI), automated market communication and multi-use models – are still in their infancy despite recent regulatory improvements. Storage systems, however, remain indispensable for stable system integration.

Conclusion: Major reform needed, but the potential is huge

The webinar made it clear that the industry is at a pivotal moment. Markets are cooling down, uncertainties are slowing investments and the regulatory environment requires rapid progress. At the same time, the experts emphasized that with a reliable legal framework and targeted reforms, PV and storage expansion can continue to accelerate, keeping the energy transition within reach. Now is the time for policymakers to step up and implement reforms with careful consideration.