What the solar roof obligation means for homeowners and builders

Background to the solar obligation

At the end of November 2021, the SPD, Alliance 90/The Greens and the FDP had agreed on a coalition agreement. Following approval of the agreement by a party congress (SPD, FDP) or a member survey (Greens), the contract was signed on 7.12.2021. The coalition agreement also contains numerous passages on real estate issues such as rent and residential construction - including “Solar Plant Expansion Acceleration Act”.

The traffic light government has agreed on a nationwide solar obligation in the coalition agreement as follows: “All suitable roof areas should be used for solar energy in the future. This should be mandatory for new commercial buildings, and it should become the rule for new private buildings.” The Federal Government wants to reduce tax and bureaucratic hurdles for the operation of photovoltaic systems.

Mandatory solar systems are also being worked on across the EU. In mid-May 2023, the EU Commission wants a concrete plan for this (“RepowerEU”) present in order to become independent of Russian energy supplies as quickly as possible. Five Member States (Austria, Belgium, Lithuania, Luxembourg and Spain) are therefore calling for a solar obligation in the EU. In a letter to the Commission, the energy ministers suggest that the expansion of solar energy in buildings in the European Union should be regulated. Specifically, administration buildings, supermarkets, flat roofs and industrial plants must be equipped with photovoltaic systems. Solar roofs should become the norm for new and renovated residential buildings. The goal that the five countries are pursuing is for at least 70 million solar roofs to be built in the EU by 2030, thus producing 1,100 terawatt hours of electricity.

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Possible advantages and disadvantages of the photovoltaic obligation

With regard to Germany, the photovoltaic obligation is still controversial and has several advantages and disadvantages.

advantages:

• Installing new solar systems is an effective measure for more green electricity in the grid and achieving climate goals.
• The photovoltaic obligation is intended to avoid additional land consumption for energy generation by using house roofs and ensure that electrical energy is generated where it is needed.
• By reducing electricity costs and paying a fixed fee for electricity, PV systems for single-family homes pay for themselves after around ten years. You can then save money with the electricity you generate yourself.

Disadvantages:

• A legal obligation could possibly reduce the acceptance of solar systems in some sections of the population.
• There are high construction and renovation costs for companies and private individuals.
• The laws and proposals that are in the room today relate primarily to new buildings — the vast majority of old buildings is not covered by them.
• There is still no prospect of a uniform solar roof requirement nationwide.

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Regulation per federal state

So far, there are no uniform regulations nationwide on the use of PV systems on buildings. However, individual federal states have already passed corresponding laws:

• In Lower Saxony, at least half of commercial properties will be equipped with photovoltaic systems in the future. However, only new buildings with predominantly commercial use with a roof area of 75 square meters or more are affected. It is also envisaged that building owners must ensure that solar systems on the roof can at least be retrofitted when planning new residential buildings.
  
  
• Baden-Württemberg is the first federal state in which there is already a solar obligation for residential and non-residential buildings. Since the beginning of 2023, it has also been extended to include renovations. For example, there is now an obligation to install a solar system when a homeowner has a roof fundamentally renovated. However, the question of what is considered a “fundamental restructuring” is causing criticism.

• In Berlin, this is taking effect Solar Act since January 1, 2023 and obliges private owners of new buildings and existing buildings to install and operate a PV system on their building roof in the event of a fundamental roof renovation. Alternatively, according to the Senate Department for Economics, Energy and Public Enterprises, the system can also be installed on the building façade or as a solar thermal system. The same applies to Hamburg.
  
  
• In Bavaria, the PV requirement has so far only existed for state buildings, industrial and commercial buildings. From 2025, the obligation should also apply to newly built and renovated residential buildings.
  
  
• In Hesse, only parking spaces with more than 50 parking spaces and state-owned buildings are subject to solar requirements so far. In North Rhine-Westphalia, this applies to parking areas with 35 or more parking spaces.
  
  
• In Schleswig-Holstein, there is also a PV requirement for parking spaces. Here, however, only with 100 parking spaces or more. There is also a PV obligation here for new commercial buildings and in the case of renovations of non-residential buildings, if they affect more than ten percent of the roof area.
  
  
• Bremen, Mecklenburg-Western Pomerania, Thuringia, Saxony and Saarland have so far had no corresponding solar obligations.

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Photovoltaic funding opportunities

The expensive installation and operation of a photovoltaic system is achieved in particular by Renewable Energy Act promoted. It guarantees a statutory remuneration claim limited to twenty years for electricity fed into the public supply network. In addition, the promotes Kreditanstalt für den Wiederaufbau (KfW) the installation of a photovoltaic system and an energy storage system above its Standard funding loan “Renewable Energies” (No. 270). KfW thus supports the construction, expansion and purchase of plants for the use of renewable energy, including the associated costs for planning, project planning and installation. However, the plants must meet the requirements of the law for the expansion of renewable energies. KfW promotional loans have terms of between five and 30 years. At best, the effective annual interest rate was 4.03 percent at the beginning of 2023, but depends on the length of the fixed interest period and the applicant's creditworthiness. The latter is determined by the house bank, through which the credit agreement is also concluded.

There is also funding at state or local level. For example, the Berlin Senate approved the Solar Plus program in July 2022. Since September 1, 2022, citizens have been able to apply for funding. This subsidizes the purchase of a battery storage system and part of the additional costs of photovoltaic systems that are not installed on a roof but on the façade or on listed houses.

Due to the wide range of funding opportunities, it is definitely worthwhile for homeowners and renovators to consider all options before installing a solar system. This is because EEG remuneration, KfW funding for photovoltaics and regional subsidies can also be combined.

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