The German solar industry anticipates an increase in company failures as expansion of solar capacity slows. Peter Knuth, chairman of the German Federal Association of Solar Craftsmen (BDSH), representing installation companies, told the economics magazine “Capital” that a market correction already underway will continue in the coming months. He specifically noted that companies unable to adapt their cost structures to the new market realities are likely to fail.
Following a surge in demand for solar installations in 2022, triggered by rising energy prices linked to the war in Ukraine – which attracted new market entrants – demand has noticeably cooled. Data from the Federal Network Agency indicates that approximately 7.1 gigawatts of new solar capacity came online in the first half of 2025, almost 15 percent less than the previous year. The decline is particularly pronounced in rooftop installations for private homeowners.
Last year, solar energy achieved a record expansion of over 16 gigawatts through rooftop and large-scale solar park installations. However, the BDSH does not foresee a swift stabilization of the situation, suggesting 2025 could prove challenging for the industry. Many companies are therefore looking to diversify into other areas, particularly heat pump installations, as reliance on photovoltaic system sales alone is no longer sufficient, according to Knuth, who also leads the Regensburg-based specialist company Enerix.
