Germany’s rapid expansion of renewable energy—particularly small-scale photovoltaic (PV) solar systems—has led to an increasing risk of generation surpluses in Germany. Since 2022, nearly 40GW of photovoltaic capacity has been added, reaching more than 100 GW in 2025. Renewables now account for approximately 60% of electricity consumption, with projections indicating 80% by 2030 and installed capacity exceeding 300 GW.

This rapid growth necessitates a more robust market and system integration of renewable energy sources. However, current regulatory frameworks and limited digitalization hinder the responsiveness of renewable assets to market signals. While direct marketing models incentivize curtailment during negative price periods, many installations, especially those under grid operator marketing, remain often non-controllable and are fully dispatched regardless of price signals.

The 2025 System Stability Report by German transmission system operators highlights that without improved integration, the affordability and security of the energy transition are at risk. Increasing occurrences of negative electricity prices (over 450 hours in 2024) and declining market values result in higher subsidy costs. Furthermore, the uncontrolled feed-in from small-scale PV systems increase the risk of overloads in the transmission and distribution grid as well as over-frequency situations, which can jeopardize the security of supply.

Transmission system operators expect surplus generation situations to arise in the coming years. To ensure security of supply in these situations, grid operators must be able to control the feed-in from small-scale PV systems. In the medium term, it will be necessary to be able to measure and control systems with an installed capacity of 7 kW or more. In addition, the subsidies and marketing of renewable energies must be further developed in such a way that no feed-in takes place when electricity prices are (significantly) negative.

The so-called 2025 peak electricity package has introduced new rules to prevent generation surpluses. These are intended to improve the controllability of small-scale plants, make the use of storage facilities more attractive, and improve feed-in tariffs and marketing in the event of negative prices.

In conclusion, addressing generation surplus requires a coordinated approach involving regulatory reform, digital infrastructure, and technical innovation. Enhanced controllability, data quality, and market responsiveness are essential to ensure the economic viability and system reliability of a renewable-dominated energy landscape.