Germany’s solar industry is beginning to feel the effects of prolonged regulatory uncertainty surrounding Solar Package I, more than two years after the legislation was adopted and while several of its measures remain pending EU State aid approval. Although the German government approved the package in 2024 to accelerate the expansion of solar energy, including changes to auction design, higher project size limits and support for different PV technologies, the European Commission has yet to give its green light to a number of key provisions due to State aid concerns. This delay is creating uncertainty for developers and is already affecting investment decisions across the sector.
In an exclusive interview with Review Energy, Carsten Körnig, Managing Director of the German Solar Association (BSW-Solar), warned that the situation is no longer simply delaying regulatory changes, but is affecting investment decisions, project pipelines and expectations for the German photovoltaic market in 2027.
“The ongoing delay in EU State aid approval — which has now persisted for over two years since the adoption of Solarpaket I — has left crucial national solar regulations frozen on paper,” Körnig said.
According to the association, conducting major auctions under rules that do not yet incorporate the pending Solar Package I provisions is causing “significant disruption across Germany’s solar industry.”
The warning comes after Germany’s 1 September innovation auction, which closed with 475 MW on offer. The auction could not apply the Solar Package I provision that would increase the maximum solar component of bids from 20 MW to 50 MW, as the required EU State aid approval remained pending.
Attention is now turning to the second-segment solar auction scheduled for 1 October, which covers solar installations on buildings and noise barriers. Different Solar Package I provisions affecting this segment also depend on the pending approval.
For BSW-Solar, the consequences extend beyond these individual auction rounds.
Solar Package I introduced a dedicated auction sub-segment for special solar installations, including Agri-PV, floating PV, moor PV and carport PV, designed to prevent these generally more expensive dual-use technologies from competing directly with cheaper conventional ground-mounted projects.
Because that mechanism cannot yet be applied without EU clearance, BSW-Solar argues that these technologies are struggling to compete under the existing framework.
“Many developers invested in planning processes and made financial commitments, which now results in severe operational losses due to postponed or cancelled projects,” Körnig said. He added that the prolonged freeze “severely damages trust in the national legal framework and paralyzes the pipeline of new, land-saving project developments.”
The association also points to a second source of uncertainty: the existing EU State aid approval for Germany’s current Renewable Energy Sources Act (EEG), excluding the pending Solar Package I provisions, is valid only until 31 December 2026.
According to BSW-Solar, projects bidding in auctions late this year whose awards are not officially announced until 2027 could face the risk of receiving no support. The association says this legal uncertainty is already making it more difficult for developers to obtain bank financing.
The effects, it says, are already visible in the market. 44% of companies in the rooftop PV segment and 56% of companies in the ground-mounted solar sector are experiencing declining demand for photovoltaic systems scheduled for installation or participation in auctions in 2027 because of uncertainty over next year’s regulatory framework.
“Instead of driving the highly necessary market acceleration of 20 GW of additions per year to meet statutory targets, the lack of EU clearance acts as an artificial brake, discouraging project pipelines and jeopardizing Germany’s expansion targets,” Körnig said.
One of the measures that could not be applied in the September innovation auction was the increase in the maximum solar component of bids from 20 MW to 50 MW.
BSW-Solar argues that the change would have a tangible economic impact on project development. “The increase of the bid size from 20 to 50 MW will reduce costs for new projects per MW and will increase overall PV installation in Germany,” Körnig told Review Energy.
But the association believes even the 50 MW threshold will eventually be insufficient.
BSW-Solar says that with the planned increase in ground-mounted PV tender volumes to 14 GW per year in total, including PPA and innovation tenders, Germany would need to go further and raise the cap from 50 MW to 100 MW.
The association also notes that the 2026 auctions have so far been highly competitive because developers are seeking awards for projects already in their pipelines before the current State aid approval expires at the end of the year. At the same time, developers are beginning to scale back the development of new projects until there is greater certainty over the future regulatory framework.
BSW-Solar said it cannot currently quantify the exact number of delayed projects, affected MW or investment volume. However, it said numerous companies made advance plans in anticipation of a rapid approval and that the two-year delay is resulting in “severe operational and economic losses” from projects that have not been realised or commissioned.
The upcoming 1 October second-segment solar auction presents a different challenge.
Solar Package I increased the annual auction volume for this segment from 1,100 MW to 2,300 MW, a change BSW-Solar considers essential to accommodate the growing pipeline of commercial rooftop projects.
The package also lowered the threshold above which rooftop systems must participate in auctions from 1,000 kWp to 750 kWp.
BSW-Solar warns that introducing the lower threshold without simultaneously expanding the auction volume to 2,300 MW would create an “artificial bottleneck.”
“Projects will be forced into a highly restricted auction pool, heavily choking the commercial rooftop market,” the association warned.
BSW-Solar is calling on the German government to resolve the State aid issues quickly, particularly through the implementation of two-sided Contracts for Difference (CfDs) with what it describes as a fair market corridor.
According to the association, CfDs should be introduced for photovoltaic systems of 200 kWp or more in accordance with European rules. While it considers the proposed transition of the existing support framework towards two-way CfDs appropriate, BSW-Solar says improvements are still required.
“In particular, a market value corridor is missing and PPA are heavily restricted by the current design of the CfD,” Körnig said.
The association argues that CfDs should be introduced immediately to meet the requirements for State aid approval of the EEG from 2027 and, ultimately, “to prevent a halt to expansion in early 2027.” 
The debate therefore extends beyond the two auctions currently in focus. For Germany’s solar industry, the key issue is increasingly whether the regulatory framework for 2027 can be resolved in time to prevent today’s planning uncertainty from translating into a broader slowdown in new photovoltaic deployment.
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