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Germany saw a 6% year-on-year decline in solar PV installations during the first quarter of 2026, driven by weakening demand in the residential sector, according to the German Solar Association (BSW-Solar).
Data from the Federal Network Agency shows that total solar installations reached 3.51GW in Q1 2026. Residential installations fell 21% year-on-year to 850MW, marking the second consecutive year of slowdown in that segment during the opening quarter.
BSW-Solar has cautioned against further subsidy cuts for PV systems, warning that such measures could push installations even lower. The draft of the Renewable Energy Sources Act proposes eliminating compensation for newly built PV systems up to 25kW—both residential and commercial—that feed power to the grid, starting in 2027. The trade body stated that if the legislation passes as drafted, it would slow solar PV expansion and endanger tens of thousands of jobs.
Commercial rooftop solar also declined, with installations totaling 600MW in Q1 2026, a 33% drop compared to the prior year. Balcony solar, for which Germany is a leading global market, decreased by 6% from the same period last year.
The only segment that grew was ground-mounted solar, which accounted for more than half of all solar PV installed in Q1 2026, at nearly 2GW. That represented a 20% year-on-year increase but was insufficient to offset the declines in residential and commercial segments.
Despite the overall slowdown, the trade body expects a slight increase in the coming weeks, citing the conflict in the Middle East and pull-forward effects ahead of potential subsidy cuts. BSW-Solar’s managing director, Carsten Kornig, said that a temporary solar boom is no substitute for reliable investment conditions.
The solar slowdown contrasted with strong growth in energy storage, which set a record first quarter with 2GWh of new capacity commissioned—a 67% year-over-year increase. That growth came primarily from large-scale storage systems of 1MWh or more, which saw nearly a fourfold increase from the previous year, with over 1GWh installed in Q1 2026.
BSW-Solar called for simplified regulatory frameworks for co-located storage to unlock the technology’s full potential, and added that batteries should be used to store electricity during negative power prices and grid congestion instead of curtailing PV systems.
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