Jun 12, 2025
In May, the price for solar energy capture in Germany dropped below €20/MWh due to cannibalization reducing its value.
The German solar market hit a five-year low in May as increased renewable energy generation led to a record number of negative hourly prices. The capture price for solar dropped to €19.97/MWh ($22.82/MWh), a 37% decline from the previous year, marking the lowest figure since May 2020, during the coronavirus lockdowns. The solar capture rate fell to 29.7%, the lowest ever, due to market value depreciation linked to doubled installed solar PV capacity since 2020, now exceeding 100 GW.
Despite this, solar remained Germany's largest electricity source in May, generating 9.8 TWh—up 13% from last year. In contrast, wind energy production increased by 26% to 9.7 TWh, adding to market pressure amid weak demand. The count of negative hours reached 129 in May, following 75 negative hours in April, affecting payments under Germany’s green energy law (EEG).
Wind capture values decreased to a 10-month low, with onshore at €61.71/MWh and offshore at €63.38/MWh, still around 10% higher than in May 2024. Platts reported daily capture prices ranged from -€64.40/MWh for solar to €105.05/MWh for offshore wind.
Payments to renewable asset owners increased to €1.9 billion ($2.1 billion) in May due to a growing disparity between market prices and contract values under EEG schemes supporting wind and solar. The government had to inject an additional €1.6 billion to balance the EEG account, totaling federal subsidies over €5 billion for the year.
Payments were reduced by 43% year over year, down about €1.9 billion, as higher market values in the first quarter coincided with low wind production. The EEG balances ensure guaranteed payments to green energy producers against their monthly market income. In 2024, the shortfall exceeded €18 billion, and for 2025, grid operators projected a €17 billion shortfall. The new German government plans to reform the EEG system and adjust 2030 capacity targets after a review of energy transition progress, with immediate efforts to reduce negative hours through new solar regulations already in place.
Despite this, solar remained Germany's largest electricity source in May, generating 9.8 TWh—up 13% from last year. In contrast, wind energy production increased by 26% to 9.7 TWh, adding to market pressure amid weak demand. The count of negative hours reached 129 in May, following 75 negative hours in April, affecting payments under Germany’s green energy law (EEG).
Wind capture values decreased to a 10-month low, with onshore at €61.71/MWh and offshore at €63.38/MWh, still around 10% higher than in May 2024. Platts reported daily capture prices ranged from -€64.40/MWh for solar to €105.05/MWh for offshore wind.
Payments to renewable asset owners increased to €1.9 billion ($2.1 billion) in May due to a growing disparity between market prices and contract values under EEG schemes supporting wind and solar. The government had to inject an additional €1.6 billion to balance the EEG account, totaling federal subsidies over €5 billion for the year.
Payments were reduced by 43% year over year, down about €1.9 billion, as higher market values in the first quarter coincided with low wind production. The EEG balances ensure guaranteed payments to green energy producers against their monthly market income. In 2024, the shortfall exceeded €18 billion, and for 2025, grid operators projected a €17 billion shortfall. The new German government plans to reform the EEG system and adjust 2030 capacity targets after a review of energy transition progress, with immediate efforts to reduce negative hours through new solar regulations already in place.