Germany’s Network Federal Agency (Bundesnetzagentur) has reduced the price ceiling for rooftop solar auctions in 2024 to €0.105 (~$0.12)/kWh from €0.1125 (~$0.12)/kWh in 2023.

The price cap (€0.735 (~$0.80)/kWh) for onshore wind and ground-mounted solar (€0.737 (~$0.80)/kWh) will remain the same as in 2023.

According to the agency, the ceiling prices for rooftop solar were reduced based on the decline in project costs. In the last round of auctions in 2023, there were not many bids above €0.105 (~$0.12)/kWh. The auction to install 191 MW of rooftop solar in November 2023 was oversubscribed by 195%. The weighted average of the awarded capacity was €0.0958 (~$0.10)/kWh – €0.006 (~$0.0065)/kWh lower than in the previous auction.

“We are creating a reliable framework for the auctions. The price ceiling takes account of the actual cost of renewables; we will be looking at setting price ceilings for biomass, biomethane, and innovative auctions in the near future,” said Klaus Müller, President of the Bundesnetzagentur.

In the absence of a new price ceiling by Bundesnetzagentur, the price ceiling would have fallen to a lower limit set under the Renewable Energy Sources Act, which is €0.588 (~$0.64)/kWh for onshore, €0.590 (~$0.64)/kWh for ground-mounted solar PV systems and €0.891 (~$0.97)/kWh for rooftop solar installations.

Bundesnetzagentur’s onshore wind energy auction in September 2023 was undersubscribed with only 1,436 MW after the initial auction volume was lowered to 1,667 MW from 3,192 MW due to lack of interest.

The Bundesnetzagentur is announcing a new price ceiling against the background of changes in the cost of developing and operating the installations and the interest rate.

Considering the underwhelming responses for solar and wind auctions in 2022, the Federal Network Agency raised the ceiling tariff cap by up to 25% in 2023. Since then, the auction responses for solar have shown significant improvements. The solar with storage auction held in October 2023 had 32 winning bids, and the lowest tariff was €0.077 (~$0.081)/kWh. The tender was oversubscribed by 95% and garnered 53 bids for a total volume of 779 MW.

The country installed 3.4 GW of solar power capacity in the third quarter of 2023, a 79% year-over-year growth from 1.9 GW. However, the installations witnessed a 5.6% drop from 3.6 GW quarter-over-quarter.