Space heating and hot water account on average for 85 percent of the annual energy consumption in German households. Rising raw material prices and the CO₂ price, which will apply from 2021, make free solar heat increasingly attractive. With a solar thermal system for heater support and water heating, home owners can do without their gas boiler completely in the summer, or they can combine solar thermal energy with a second renewable heating technology and heat in an entirely climate-neutral way. And all this with attractive subsidies!

For district heating customers, too, solar thermal energy together with other renewable energies offers the opportunity to move away from fossil fuels and towards climate-neutral heating.

The German Solar Association, as the representative body for the German solar industry, actively participates in the public debate on energy policy. In dialogue with political decision-makers, industry representatives, the media, and the public, the association develops positions and concepts on current issues of energy policy. We actively support the transition in heating—there is still much to be done in German boiler rooms and district heating networks!

Tax Incentives and Market Incentive Program

At the turn of the year 2019/2020, there have been numerous improvements from the perspective of homeowners interested in solar heat: In addition to the completely new tax incentives for heating replacement, the subsidy rates for solar heating systems in the Market Incentive Program (MAP) were significantly increased, particularly in existing buildings.

With the tax incentives, consumers get 20 percent of the investment sum for their new solar heating system back from the state—quite simply and without any prior application or energy advice. The subsidy sum is deducted from the tax liability.

The amended MAP of the Federal Office for Economic Affairs and Export Control (BAFA) is even more attractive due to significantly higher subsidy rates. Here, as an alternative to tax incentives, investors receive a subsidy of up to 45 percent—depending on the other heat source with which they combine the solar collectors. Consumers can also decide, as before, whether they want to receive the subsidy as a grant, or a loan through the federally owned KfW banking group covering the entire investment sum, from which they will receive the subsidy as an amortization subsidy.

How Does the Application Process Work?

Funded plants must be approved in advance. The application for funding must therefore be submitted to BAFA before the contract is awarded to a suitable installer. After receiving the confirmation of receipt, the measure can be started at one’s own risk. If the eligibility of the installation appears to be largely undisputed, this risk can be taken. One is on the safe side if the measure start only after the approval of the subsidy by BAFA has been granted.

All information, including the application procedure and funding rates, can be found on the BAFA website.

Helpful Links on Funding (in German)

Improvements in the Market Incentive Program (MAP)
Improvements in KfW funding
Tax incentives
Leaflet of the German Solar Association (PDF)

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Solar Thermal Energy in Heating Networks

Local and district heating networks are an important key to the increased integration of renewable energies in the heating sector. They make it possible to collect renewable energies on an industrial scale and at low cost and to transport them to the consumers (industry, trade, end users). In addition, heating networks are flexible with regard to the integration of diverse heat generation technologies.

Large solar thermal plants can already provide heat for heating networks at competitive costs of 3 to 5 cents per kWh—and this is also the case in Germany. It offers a high degree of long-term cost security for suppliers and consumers. Fuel costs will no longer be incurred in the future and the investment is easy to calculate. Solar network heat has therefore long since ceased to be a demonstration project. Accordingly, the industry is currently registering great interest among potential customers, for example, from the municipal utility sector, in the German market.

Association Goal: More Solar Heat in the Grids!

The German Solar Association has set itself the task of increasing the use of solar heat for the provision of heat requirements in heating networks. The potential of solar heat in heating networks has also been recognized by politicians. This is demonstrated by the introduction of new support instruments such as the “Heating Networks 4.0” support program—more detailed information can be found on the website of the Federal Office for Economic Affairs and Export Control.

The promotion of combined heat and power (CHP) generation in the German Combined Heat and Power Act (KWK-G) is also to be geared more strongly to renewables in future. To this end, the so-called CHP innovation tenders will encourage the combination of solar thermal energy (or heat pumps) and CHP plants. And the federal government continues to offer very attractive funding opportunities for solar-thermal supported heating networks through KfW’s Market Incentive Program.

Political Work of the German Solar Association

The German Solar Association pursues several approaches for more solar heat in the heating networks. In addition to improved support through federal funding programs (especially the Market Incentive Program), we believe that the introduction of a pricing system for CO₂ from 2021 onwards is a well-suited means of replacing fossil fuels and generation technologies with renewables. We have always been committed to this, and even if the entry price is too low in our opinion, it is still the long fought-for step in the right direction.