Germany ‘neglects’ massive rooftop PV power potential

Germany has space on the rooftops of its industrial and logistics building stock to locate enough PV panels to provide the equivalent electrical output of 36 nuclear power plants each of 1 gigawatt, or 121 fossil fuel-powered plants generating 300 megawatts apiece.

So far less than 10% of this roof space has been thus exploited and “numerous obtstacles” are impeding faster exploitation of the opportunity by property developers, financiers and owners according to Garbe Industrial Real Estate.

“It is an enormous opportunity that has been grossly neglected so far,” the firm said in a statement. This was one of the conclusions of a panel discussion attended by Tobias Kassner, head of research at GARBE Industrial Real Estate, Manuel Schrapers, managing director of Metroplan; Moritz Wickert, managing director of GARBE Renewable Energy, and Inka Klinger, head of project finance at Hamburg Commercial Bank.

The poor takeup of this opportunity is despite the fact that PV systems are cost-effective on areas of 5,000 sq m and over and a Federal Government policy that aims for a generating capacity of 215 Gigawatts from solar energy by 2030.

Currently only seven gigawatts is added per year to the 60 GW that were on-stream in 2022. That is not nearly enough to achieve the government’s goal and the rate of increase would need to triple to around 22 GW per year to do so.

Germany has roofspace potential of 362.8 million sq m which could be used to generate over 36 Gigawatts of electricity.

“Our calculations show that PV systems on top of logistics and industrial properties could largely replace fossil energy sources. To use a concrete example, this would equal the output of 36 assumed nuclear plants (1 GW each) or 121 gas- or coal-fired power stations (300 MW each).” Accordingly, photovoltaic systems contribute significantly to the phaseout of fossil-fuel electricity generation,” said Kassner.

A further 5 to 6 million sq m of new roof space is added each year.

Although Garbe has identified around 32,500 potentially eligible logistics and industrial properties, not all are suitable for solar power generation with the most common reason for ineligibility being their poor state of repair.

Furthermore, 40% to 50% percent of the roof surfaces of standing properties are currently not used for solar panels because power distribution grids are outdated resulting in “feed-in uncertainty” and poor planning predictability. The overriding goal for the near future: Increasing the share of usable roof surfaces to somewhere between 65 and 80 percent. “An important step is to secure the minimum remuneration for the investor,” said Kassner.

According to Metroplan managing director Manuel Schrapers, developing existing building surfaces for this type of use poses an enormous challenge. “The key question with existing properties, aside from age and state of repair, is often whether their structures are actually strong enough to bear the weight of PV systems,” he said.

Futhermore, In the case of manufacturing properties, structures such as ventilation systems could, hamper the installation.

For banks, existing access to the utility grid is decisive for project financing approvals. “Banks tend to rely on collateral securities for their financing arrangements, and these will vary depending on ownership structure. They can take any of various formats, such as land charges, easements or usufruct, but may also include assignments of claims from any and all relevant project contracts,” said Inka Klinger, head of project finance at Hamburg Commercial Bank. Another fundamental for lenders is the need to ensure that the rights to set up, operate and maintain the facilities as well as access to them have been secured. “The significant rise in lending rates is putting pressure on returns. This has lately made alternative investments that meet the return expectations but come with lower project risks an increasingly interesting proposition for investors.”