Menu

Proliferation of Solar Panels Has Crashed Kilowatt Prices In Germany

By
Photo: Proliferation of Solar Panels Has Crashed Kilowatt Prices In Germany. Source: Freepik
Photo: Proliferation of Solar Panels Has Crashed Kilowatt Prices In Germany. Source: Freepik

German solar power producers cut prices by 87% last week during business hours and received a volume-weighted electricity price of just €9.1/MWh, according to a report by SEB Research.

In fact, when production peaks, prices fall well below zero. 

For comparison, the average electricity price during non-solar hours was 70.6 EUR/MWh. Thus, solar power producers have received a massive reduction in the price of electricity they receive during production compared to the price of electricity during non-solar hours. 

‘This is what happens to electricity prices when the amount of unregulated electricity becomes equal to or greater than demand: prices fall when unregulated electricity is producing the most,’ the Swedish bank wrote on Tuesday.

Last year's wave of solar installations caused prices in Germany to be ‘destroyed’ as stocks outstrip consumption. While the total capacity of solar panels exceeded 81.7 gigawatts by the end of 2023, the demand load reached only 52.2 gigawatts, said SEB's chief analyst Bjarne Schildrop.

The difference between the two actually increases even more in the summer, the season of peak production and lower demand. 

This also means that consumers do not necessarily benefit from low prices, as they typically consume more energy during hours when there is no solar power. 

Unless new installations are incentivised by subsidies or power purchase agreements, low profitability could eventually halt solar expansion in Germany, said Schildrop.

So now the focus is likely to be on improvements that will allow for greater utilisation of the energy produced, such as investments in batteries and grid infrastructure.  

Recommended

Economics

Lukoil Attempts to Circumvent Sanctions

07.19.2024 16:17
Economics

War, Drought, and Other Reasons for Expensive Food

07.19.2024 12:53
Culture

Top 9 Most Expensive Paintings by Ukrainian Artists

07.19.2024 10:15
Economics

China's Slowdown

07.18.2024 15:54
Life

Authentic Portugal

07.18.2024 10:05

Similar articles

We use cookies to personalize content and ads, to provide social media features and to analyze our traffic. We also share information about your use of our site with our social media, advertising and analytics partners who may combine it with other information that you've provided to them. Cookie Policy

Outdated Browser
Для комфортної роботи в Мережі потрібен сучасний браузер. Тут можна знайти останні версії.
Outdated Browser
Цей сайт призначений для комп'ютерів, але
ви можете вільно користуватися ним.
67.15%
людей використовує
цей браузер
Google Chrome
Доступно для
  • Windows
  • Mac OS
  • Linux
9.6%
людей використовує
цей браузер
Mozilla Firefox
Доступно для
  • Windows
  • Mac OS
  • Linux
4.5%
людей використовує
цей браузер
Microsoft Edge
Доступно для
  • Windows
  • Mac OS
3.15%
людей використовує
цей браузер
Доступно для
  • Windows
  • Mac OS
  • Linux