Some good news for real estate owners and rooftop solar PV projects in Germany!
On the 22nd March 2024, after months of mediation, the German Federal Council finally approved the Growth Opportunities Act (WtChancenG). The law, which is intended to reduce bureaucracy and promote tax relief, is expected to be promulgated in the near future.
What does this law have to do with rooftop solar PV?
The law increased the so-called "harmlessness limit" (Unschädlichkeitsgrenze) - which is the share of income that real estate owners can receive from renewable supply (including solar PV) - from 10% to 20% of their overall income.
What is the background?
Most real estate companies in Germany are exempt from the trade tax, as long as the majority of their income is rent.
To foster local renewable market growth, a law was introduced in 2021, which allowed real estate owners to receive up to 10% income from renewable energy supplies - for example, supplying solar PV to tenants! This limit was known as the "harmlessness limit".
Whilst it was a step in the right direction, this limit was considered  too restrictive, carrying too much risk for landlords, who may exceed that income limit for larger renewable systems. Whilst real estate owners were increasingly under pressure to decarbonise their building, the 10% threshold limited landlord-let rooftop solar PV projects.
Several parties called for an increase in this "harmlessness limit", which has now been approved in the Growth Opportunities Act.
The "harmlessness limit" is now 20%, and will also retrospectively apply for tax year 2023.
What positive outcome can we expect for commercial rooftop solar PV in Germany?
For most landlords, this will mean that the maximum solar PV system can be built on their building's roof and supplied to the tenants, without being at risk of reaching this limit.
We hope that this will push more landlords to install solar PV and supply on-site renewable energies to their tenants.
With over a decade of experience across Germany, the UK and the EU, Syzygy's solar PV teams are ready to support you with your solar PV investment decisions, and can help you size the right system that would allow the best decarbonisation potential whilst maximising the return on investment.
You can contact us for more information at hello@syzygyconsulting.eu.
