Over the past three years, the EU’s solar capacity has been increased twofold. What role did subsidies play in making this achievable, which forms of assistance remain accessible, and what further steps are necessary?
In Marbella, located along Spain’s Costa del Sol, Jesus Miguel Vera Lopez has adorned his rooftop with solar panels. He stated, “Like many others, I installed them to reduce my electricity costs.”
This isn’t just happening in Spain. Corinna Gutmann, who leases an apartment in the west German city of Bonn, has set up solar panels on her balcony. Her system is among more than a million that were registered throughout Germany in 2024.
She mentioned that she had been wanting this on her balcony since approximately 2013. However, at that time, the procedure was significantly more complicated,” she explained. “There have been many improvements since then.
She and Vera Lopez are among those contributing to an increase in solar energy uptake that spans globally and is notably evident in Asia and Europe.
The growth of solar power in Europe is largely due to the European Union, which aims to achieve net-zero emissions by 2050. The reliance on renewables was central to their strategy even before the energy crisis caused by Russia’s invasion of Ukraine in 2022. This event accelerated efforts within the EU to urgently deploy substantial amounts of renewable energy as part of an initiative to reduce dependency on Russian fossil fuels.
According to the European Union Commission’s 2022 Solar Energy Strategy, solar power will play a pivotal role in this initiative. “Cell by cell, the boundless energy from the sun will assist us in decreasing reliance on non-renewable resources.”
In collaboration with the European Data Journalism Network, they have examined the ways in which Europe’s governments are supporting the growth of solar energy across the continent.
Why did solar energy gain such rapid popularity?
Currently, many EU nations have an installed capacity of approximately one kilowatt per individual, which is comparable to about two solar panels. The Netherlands tops this list with 1.4 kilowatts per person, trailed by Germany at 1.2 kilowatts.
In the mid-2000s, we witnessed the initial surge in solar energy adoption,” stated Raffaele Rossi, who leads market intelligence efforts at Solar Power Europe. He elaborated that governments began implementing feed-in tariffs, which compensate individuals for the electricity they contribute back to the power grid. Consequently, this led to significant expansion in early adopter nations such as Germany, Greece, Belgium, Spain, Italy, and France.
Nevertheless, the substantial expense of solar technology deterred most homeowners, according to Rossi. However, over the years, significant advancements have reduced worldwide installation expenses by approximately 90%.
Owing to the extra impetus from the worldwide energy crisis, the European Union’s solar power capacity has doubled just between 2021 and 2024.
The solar industry is poised to surpass the European Union countries’ 2030 solar objectives. According to an analysis conducted by Solar Power Europe, only three member states might not achieve these benchmarks on schedule, whereas twenty others aim to meet or even outperform their respective targets prior to 2030.
Small-scale residential installations on balconies and rooftops are contributing to this change, accounting for a quarter of all EU solar capacity.
Although costs have decreased, investing in solar energy still demands significant initial expenditure. Corinna Gutmann’s balcony installation set her back €650 (approximately $680), whereas Jesus Vera Lopez’ rooftop system came with a price of €6,000.
“It is a profitable investment,” said Vera Lopez, whose electricity bill has gone from more than a €100 to €15 per month. This is in line with a 2023 study by Solar Power Europe which found that family homes in Germany, Italy, and Spain could save over €1,000 per year on energy bills by installing solar panels.
Enabling everyone to access solar power effectively
The upfront costs are beyond the reach of many individuals. As stated by Seda Orhan, who works as the Renewable Energy Manager at Climate Action Network Europe—a coalition of non-governmental organizations pushing for environmentally friendly climate and energy strategies—”Our efforts should particularly target disadvantaged, lower-income families.” She further explained that these groups remain largely uninvolved in the shift towards renewable energy sources within our communities.
The European Union is encouraging its member countries to assist their populations in making this transition by simplifying rules and offering financial aid, particularly for those with lower incomes. Different member nations address this matter through varied approaches.
Where citizens pay less for solar
At least nine European countries, including Germany, have reduced VAT rates on solar panel sales and installation. This should result in a direct price reduction for consumers instead of reimbursements which can imply complex application processes.
Across Europe, governments also offer direct financing to citizens investing in solar power, though the amounts and conditions vary dramatically.
Hungary is leading with substantial incentives, covering up to sixty-six percent of the expenses related to solar panels for residential properties, under certain conditions and when coupled with investments in energy storage systems. In contrast, Sweden employs a distinct strategy through its “Grön Teknik” initiative, providing a twenty-percent cashback with very little administrative hassle involved.
For Gutmann, equipping her Bonn balcony with solar panels turned out to be unexpectedly budget-friendly. The city subsidized nearly half her expenses—€300—through an uncomplicated procedure. She explained, “All I needed was to complete a brief application, submit my receipt along with a photo of the balcony, and I got the funds back within just two weeks.” Gutmann added confidently, “The investment in these solar panels will recoup itself in about two years.”
Regional grants frequently more substantial
Although German tenants have access to these programs, many European nations restrict their assistance primarily to homeowners such as Vera Lopez.
He applied for the Andalusian regional initiative Plan Eco Vivienda, set to conclude in December 2024. His aim is to receive reimbursement for 40% of his expenses; however, his submission hasn’t been approved yet. The procedure proved challenging for him as well: “Although my educational background isn’t extensive, they requested information that was unclear to me,” he explained.
The subsidy scheme in Spain is notably intricate with frequent lengthy delays. As stated by CAN’s Seda Orhan, “Despite funds being set aside, fewer than fifty percent of the requested solar subsidies have been disbursed within two years.” Nevertheless, Spain provides some of the highest potential payout amounts in Europe for costlier rooftop setups.
Beneficial loans and tax breaks
Many governments and banks also offer low-interest loans for solar installations, with Belgium’s Wallonia region even providing zero-interest options for low-income households.
Additionally, homeowners can claim significant income tax deductions on their solar investments in Spain and Italy, while Germany and Sweden reduce taxes on electricity sold to the grid.
A complete overview of solar subsidies identified in this analysis can be found in this database.
Doubt about upcoming assistance initiatives
Her analysis revealed multiple solar subsidies nearing their expiry, with some having already concluded. Seda Orhan highlights the ambiguity around prospective EU financing. The current Multiannual Financial Framework of the EU concludes in 2027, and discussions for a fresh budgetary plan are only starting. “Securing a robust EU budget will be essential,” stated Orhan. “Afterward, we can determine its distribution.”
Certain administrations are beginning to advocate for eliminating subsidies entirely, according to market specialist Raffaelle Rossi. He explained that under suitable circumstances, direct aid could potentially decrease but must be approached with caution. Negative reactions from the marketplace due to subsidy reductions have already been observed. Additionally, he noted that these benefits continue to be crucially supportive for lower-income families specifically.
“Continuing to back solar power remains crucial,” Seda Orhan noted additionally. She further highlights the economic benefits associated with the solar industry, which currently provides jobs for over 800,000 individuals within the European Union, primarily through localized installations. This generates immediate economic gains for governing bodies that sustain funding initiatives in this area.
Solar growth depends on reliable infrastructure
Despite subsidy uncertainties, Solar Power Europe is forecasting another doubling of capacity in the EU before 2030. Rooftop solar remains the largest segment, with larger-scale installations catching up.
Success will hinge on a robust solar infrastructure. According to the EU’s Solar Energy Strategy, this includes training enough workers to manufacture, install, and maintain solar power systems, as well as modernizing the European electricity grid to handle the surge in decentralized energy sources from solar installations.
Energy storage solutions are key as well, notes Rossi. They allow power to be used where it is generated, reducing pressure on the grid at large.
For Corinna Gutmann, her balcony solar installation has proven worthwhile. She stated, “Seeing more solar panels around the neighborhood sparks curiosity among others.” She added, “It seems quite contagious. Moreover, initiating such a project has become considerably simpler nowadays.”
Sofia Kleftaki, Zsolt Bogar, Michal Gostkiewicz, and Emmy Sasiporkarn provided research for this investigation.
Edited by: Gianna Grün, Tamsin Walker
Additional details regarding the data, methodology, and code for this story are available in this repository.
Additional data-driven narratives can be explored here.
This project is a collaboration among several media outlets in the European Data Journalism Network. While was project lead, the Center for Investigative Journalism of Serbia and El Orden Mundial were contributing partners.
Author: Kira Schacht
