Direct Investment in Solar Power in 2026: What Is It, What Are the Benefits—and Who Should Consider It?
A direct investment in photovoltaics makes you the owner of an actual PV system—no fund shares, no loans, no ETF shares.
The short answer
A direct investment in solar power means that you become the owner of a specific solar power system as a depreciable movable asset. The solar power generated belongs to you—the revenue comes from feed-in tariffs, direct sales, and self-consumption.
Only this model combines the investment tax credit (IAB, 50%), special depreciation under Section 7g(5) of the German Income Tax Act (EStG) (40%), and declining-balance depreciation—tax benefits that are structurally unavailable with funds, crowd investing, and ETFs.
Base return of 6–10% per year, with tax leverage of up to 10–12% per year. The window for 20 years of guaranteed EEG feed-in tariffs will close with the planned system change in 2027.
This guide is intended for individual and commercial investors seeking in-depth information on direct investments in photovoltaics in 2026. It explains the benefits of direct investments in photovoltaics, the tax advantages unique to this approach, the associated risks, and how it differs from solar funds, crowd investing, and solar ETFs—presented objectively, with supporting data, and without a product pitch.
Anyone looking to invest in solar energy or renewable energy—whether as a solar investment, a photovoltaic investment, a photovoltaic capital investment, or a direct solar investment—will encounter at least four models: closed-end solar funds, crowd investing via subordinated loans, solar ETFs, and direct photovoltaic investments.
For many investors, the goal is to build wealth through a real, tangible asset rather than a purely financial instrument. This is precisely where direct investment in photovoltaics comes in. The terms may sound similar, but they involve fundamentally different legal relationships, tax structures, and risk profiles. Those who first want to get a sense of the market as a whole will find the necessary context in the “Photovoltaics Investment Overview Guide.”
What is a direct investment in solar power?
A direct photovoltaic investment allows the investor to purchase a solar power system directly. Investors thus invest directly in a photovoltaic system and become the owners of all its components—panels, inverters, and other technical components. This is the structural difference from all other models on the market.
Terms such as “PV Investment,” “Solar Direct Investment,” or “investing in photovoltaics” are used to market a wide variety of investment structures—ranging from bonds and subordinated loans to exchange-traded funds. The key difference lies in their legal nature.
Classification Based on Legal Nature
- Direct Investment in Photovoltaics: You are the owner of a photovoltaic system, which is classified as a depreciable movable asset (Section 7g of the German Income Tax Act (EStG)). The system is registered in your name under both civil law and tax law.
- Closed-end fund: You hold a limited partnership interest in a company that owns solar power plants. No direct ownership, no individual depreciation deductions.
- Crowdfunding / Subordinated Loans: You provide a loan and receive interest. You own neither the investment nor any shares—only a claim that will be satisfied last in the event of insolvency.
- Solar ETF: You hold shares in an exchange-traded fund that invests in solar companies. This has no connection to any individual photovoltaic system.
Anyone looking for information on direct investments in photovoltaics should understand these differences before comparing providers such as Denpro, ohana invest, or Logic Energy.
A direct comparison of the four investment models
| Criterion | Direct Investment in Solar Power | Closed-End Solar Fund | Crowdfunding | Solar ETF |
|---|---|---|---|---|
| Legal Nature | Owner of the solar power system | Limited partnership interest (KG) | Lender (subordinated) | Fund share (security) |
| Typical annual return | 6–10% base, up to 10–12% with IAB + depreciation | 4–8% (projected) | 4–8% fixed interest rate | highly volatile; 3-year return negative ¹ |
| Total investment | starting at approx. €50,000–€100,000 | from €1,000 to €20,000 | from €50 to €1,000 | Starting at €1 (savings plan) |
| Tax Benefits: IAB / Depreciation | Yes, full use | No, it's not structurally possible | No, that's not possible | No, that's not possible |
| Tax effect (cumulative, 1–2 years) | up to 62–77.5% of the investment | ~3–5% | 0 % | 0 % |
| Liquidity | very low | very low | None (until maturity) | tradable daily |
| Maximum risk of loss | medium (property value, EEG protection) | high (total loss possible) | high (total loss in the event of insolvency ²) | high (drawdown of −70 to −75 % ³) |
| 20-Year EEG Grandfathering Provision | Yes | In some cases (depending on the fund) | In some cases (depending on the project) | No |
| ¹ iShares Global Clean Energy UCITS ETF (IE00B1XNHC34): 3-year return of approximately −8% p.a. in EUR as of Dec. 31, 2025 (justETF); strong recovery during 2026. ² Insolvency cases: Sonneninvest Deutschland GmbH (Sept. 2024, Erfurt Regional Court); te Solar Sprint IV (May 2022, AG Leipzig). ³ Invesco Solar ETF (TAN): −37.62% (2024), −26.79% (2023). Return on direct PV investment: Helm Group / mediplan Helm e.K. Portfolio data for 2024 – no guaranteed values. | ||||
The tax effect for the first one to two years is cumulative and not limited to the year of acquisition alone—you can find the calculation in the chapter on taxes. The key point is that only direct investment can offset this effect.
The Inverter Model: Physical Ownership
The inverter model works as follows: The investor acquires civil law ownership of a defined portion of the photovoltaic system—typically organized by inverter units. An operator handles planning, construction, maintenance, and commercial management under a long-term operating agreement.
The electricity generated is compensated based on the owner's share of the total system—through the EEG feed-in tariff, direct marketing, or a power purchase agreement (PPA).
Why This Distinction Matters for Tax Purposes
The revenue goes directly to the investor—not as a fund distribution, but as compensation for solar power fed into the grid or consumed on-site from the investor’s own property.
The key tax benefit: Since the investor is acquiring a depreciable movable fixed asset, he or she can claim the investment deduction and special depreciation under Section 7g of the German Income Tax Act (EStG). This is not possible with funds or loans. Learn more about the tax implications: All Tax Benefits for PV Investors in 2026.
Three Sources of Revenue from a Direct Investment in Photovoltaics
Revenue Source 1 – EEG Feed-in Tariff
For solar power fed into the public grid, the grid operator pays a legally mandated feed-in tariff for 20 years—regardless of the electricity price on the market.
The current rates (effective August 1, 2026, through January 31, 2027): Partial feed-in up to 10 kWp: 7.70 ct/kWh; 10–40 kWp: 6.66 ct/kWh; 40–100 kWp: 5.44 ct/kWh. The feed-in tariff decreases by approximately 1% every six months (Section 49 of the EEG 2023); the reduction effective August 1, 2026, has already taken effect, and the next reduction will take effect on February 1, 2027.
Under the Solar Peak Act (February 2025), new systems with a capacity of 25 kW or more must be controllable via a smart metering system; the requirement for direct marketing continues to apply only to systems with a capacity of 100 kWp or more. More on this: Declining feed-in tariffs in 2026.
Revenue Source 2 – Direct Sales
Larger systems (subject to direct sales requirements for systems of 100 kWp or more) sell their solar power directly on the wholesale market. The market price for solar power fluctuated significantly in 2025; the annual average was 4.51 ct/kWh (netztransparenz.de), compared to 4.624 ct/kWh in 2024.
In the case of subsidized direct sales, the market premium kicks in if the exchange price falls below the benchmark value—this limits the downside risk and acts as a hedge against price declines. Outside the scope of EEG subsidies, power purchase agreements (PPAs) become more relevant, currently at around 45–65 EUR/MWh, with a recent downward trend. Read more: Direct Marketing of PV Electricity in 2026.
Revenue Source 3 – Self-Consumption
For rooftop systems on commercial properties, the operator or a tenant consumes the electricity directly at the point of generation. Instead of receiving a feed-in tariff of 5.44–7.70 ct/kWh, the solar power replaces expensive grid purchases.
The economic benefit is structurally higher because grid fees, surcharges, and taxes are eliminated. For companies with high self-consumption, this component is often the most profitable. Learn more: PV with Battery Storage: Maximizing Self-Consumption.
Return on Investment: What a Direct Investment in Solar Power Really Delivers
Factor 1 – Location and Plant Type
Location is the most important factor affecting yield. In Germany, the specific annual yield varies between 900 and 1,150 kWh/kWp, depending on the solar radiation region.
Sites in Bavaria and Baden-Württemberg generate, on average, 5–8% more energy than sites in northern Germany, such as Mecklenburg-Western Pomerania, because solar radiation is higher there; a solar farm with optimal orientation typically generates 8–12% more energy than comparable rooftop systems.
According to Fraunhofer ISE, system costs for turnkey commercial rooftop systems (>30 kWp) range from approximately 900–1,600 €/kWp, and for ground-mounted systems (>1 MWp) from 700–900 €/kWp—in each case based on installed PV capacity. After four months of increases in early 2026, prices have stabilized since July 2026; prices are stable, and availability has improved. Source: How Much Will a PV Investment Cost in 2026?
Factor 2 – Financing Security Before Construction Begins
A common mistake: Projects in which funding is secured before approval has been granted shift the full development risk to the investor.
The model, in which financing is secured before construction begins, means that banks have already reviewed and approved the project, and the investor does not come on board until afterward—eliminating the risk associated with obtaining permits. This difference is more critical to the actual return achieved than nominal return promises.
Factor 3 – Long-Term Management and Transparency
A 200-kWp system generates approximately 3.4–4 million kWh of solar power over 20 years—emission-free and without fuel costs. The technical service life of modern PV systems is 25–30 years; in general, photovoltaic systems have a service life of 20 to 30 years.
Technical revenue shortfalls caused by poor monitoring or delayed maintenance add up to significant losses in returns over the system’s lifetime. Sound operational management means: monthly revenue reporting, remote monitoring at the inverter level, performance ratio monitoring, and clear escalation procedures.
Roof-mounted or ground-mounted system: Which PV system is right for you?
Commercial Rooftop Solar Systems
Roof-mounted photovoltaic systems on commercial and industrial buildings are generally smaller than ground-mounted solar farms and often range from 30 to several hundred kWp.
The main benefit is the option to use the electricity yourself: If the solar power is used on-site, it replaces expensive grid purchases. For business owners with suitable roof space, this is often the most effective way to boost returns.
Ground-mounted solar systems and solar farms
Ground-mounted solar systems generate large amounts of electricity at lower specific system costs and are suitable for larger capital investments. Their revenue comes primarily from feed-in tariffs and direct sales.
As a tangible asset investment in the renewable energy sector, they offer predictable returns over 20 years—a solid foundation for building wealth and hedging against volatile capital markets.
Tax Benefits of Direct Investment in Photovoltaics: IAB, Special Depreciation, and Declining-Balance Depreciation
IAB – Investment Tax Credit (Section 7g(1) of the Income Tax Act (EStG))
The investment tax credit (IAB PV system) is the most effective tool for reducing the tax burden prior to the investment. It acts as an advance reduction in profits: a deduction rate of 50% of the estimated acquisition costs—already in the year before the system goes into operation.
The maximum total IAB amount per taxpayer as of the balance sheet date is limited to €200,000 (Section 7g(1), sentence 4, of the Income Tax Act (EStG)). Profit limit: €200,000 in the year of deduction. Investment period: 3 years.
Special Depreciation (Section 7g(5) of the Income Tax Act)
The special depreciation allowance supplements the IAB: 40% of the acquisition cost reduced in accordance with the IAB, increased by the Growth Opportunities Act (enacted on March 27, 2024), for assets acquired after December 31, 2023.
May be freely allocated in the year of acquisition and the four subsequent years. Important: It is calculated based on the tax base reduced in accordance with IAB—IAB and special depreciation work in tandem.
Straight-line and declining-balance depreciation
The straight-line depreciation rate is 5% per year over 20 years (the official useful life for PV systems). In addition, for new systems installed after June 30, 2025, and before January 1, 2028, the declining-balance depreciation method applies in accordance with Section 7(2) of the German Income Tax Act (EStG)—part of the 2025 Immediate Investment Program, often referred to in the media as the “Investment Booster.”
The rate is capped at three times the linear depreciation rate, with a maximum of 30%. For photovoltaic systems, this specifically means 15% per year of the remaining book value (3 × 5%)—the general 30% cap does not apply to PV systems.
What the combination results in
Example: Commercial solar power system, acquisition cost €400,000, acquired in 2026, marginal tax rate 45%.
- Investment deduction in the previous year: 50% × €400,000 = €200,000 reduction in taxable income → approximately €90,000 in tax relief.
- Special depreciation on the reduced basis (€200,000): 40% = €80,000 in the year of acquisition.
- Declining-balance depreciation in the year of acquisition, applied to the reduced tax base (€200,000): 15% = €30,000 (the special depreciation reduces the residual book value only in subsequent years).
Over the first one to two years, approximately €310,000 of the €400,000 can be claimed for tax purposes—over 60% of the investment, and up to about 77.5% of the total investment amount. A key point to note: The initial asset value (IAB) of €200,000 is recognized in the previous year. In the year of acquisition itself, only special depreciation and declining-balance depreciation apply (€110,000 = 27.5%). Anyone who interprets the 77.5% figure as solely a first-year effect significantly overstates the cash flow impact of the year of acquisition.
The ongoing income from direct photovoltaic investments—feed-in tariffs, direct sales, and savings from self-consumption—is generated on top of that over 20 years. This makes direct PV investments particularly attractive for investors with a high marginal tax rate.
Note: This section is provided for general information purposes only and does not constitute tax advice. Eligibility for IAB, special depreciation, and declining-balance depreciation depends on your individual tax situation (including, among other things, the profit threshold, useful life, and at least 90% business use). Please consult a licensed tax advisor. All information is provided without warranty. As of August 2026.
Risks & Experiences: What Investors Need to Watch Out For
What Sets Direct Investment Apart from Crowd Investing
Anyone researching direct investments in photovoltaics will quickly come across the wave of bankruptcies in crowd investing—Sonneninvest (09/2024), te Solar Sprint IV (05/2022), and other cases in which subordinated loan investors bore the full financial risk.
This is precisely where the key difference lies: With a direct investment, you are the owner of a physical asset, not a creditor of a project company. If the operator defaults, the asset remains your property and can continue to be operated or sold.
Where the Real Risks Lie
The real risks of direct investment lie elsewhere: in a poorly chosen location, in inadequate management, in regulatory changes (such as the CfD reform starting in 2027), and in limited tradability.
A direct PV investment is an illiquid real-asset investment with a term of 20–40 years; early exit is possible through resale, but the secondary market is limited. These risks can be managed by choosing the right provider—see the following checklist. The comparison “PV Crowd Investing vs. Direct Investment 2026” shows the specific differences between direct investment and crowd investing.
Who This Model Is Suitable For—and Who It Isn't
This model is suitable for commercial investors, entrepreneurs, self-employed individuals, and companies with taxable profits that can actually take advantage of the tax incentive under Section 7g. For businesses that consume solar power themselves, the self-consumption effect is often the most powerful incentive.
Among the various investment opportunities in the renewable energy sector, direct investment is the only one that combines full tax leverage with true ownership.
It is less suitable for investors who need the ability to trade at any time, do not have business income to offset against the investment, or wish to invest only small amounts. For these types of investors, exchange-traded products remain the more practical choice—without the tax advantage, but with daily liquidity.
Checklist: What a reputable provider must offer
- A complete value chain from a single source —land acquisition, planning, construction, and operation. Not just sales with subcontracting to third parties.
- Project approved in-house prior to investor involvement —the investor will not join until approval is granted, so there is no development risk.
- Project financing secured before construction begins —the bank has approved the financing, costs are fixed, and there will be no further financing rounds after the project begins.
- Personal liability of the operator —whether a sole proprietor (e.K.) or a general partner—creates a different liability structure than that of a standard GmbH.
- All-Risk Insurance – covers technical risks, loss of income, weather events, and theft.
- Transparent yield monitoring —monthly reports, remote access to inverter data, and performance ratio comparisons against a benchmark.
- Track record of completed projects —verified actual data from operating plants, not just forecasts.
- Independent technical review —a technical advisor assesses the site, the quality of the system, and the projected output before construction begins.
- Clear Contract Structure – Purchase agreement for the asset, separate management agreement, with the term and renewal options set forth in writing.
The 2026 regulatory window
What specifically is known (as of August 2026)?
The process of turning the idea into law has made significant progress: On July 29, 2026, the Federal Cabinet approved the government’s draft bills for the EEG 2027 and the Grid Package. At the heart of the proposals is the move away from the traditional fixed feed-in tariff for new installations, a direct marketing requirement for all, and a two-way Contract for Difference (based on EU Regulation 2024/1747, effective July 17, 2027).
Important for context: The draft is not yet legally binding. The Bundestag and Bundesrat are expected to make a decision starting in September 2026; approval from the European Commission is also required. The planned effective date is January 1, 2027. Figures and measures may still change during the parliamentary process.
Key point: The reform applies only to new installations. Existing installations are grandfathered in—anyone who commissions a system by December 31, 2026, will be eligible for the current subsidy structure for 20 years. Details: CfD requirement in 2027—what PV investors need to know now.
Secure 20 Years of EEG Feed-in Tariffs
Anyone who commissions a solar power system by December 31, 2026, is guaranteed a fixed feed-in tariff for 20 years under the Renewable Energy Sources Act (EEG). This 20-year grandfather clause is the core of the current window of opportunity—regardless of the specific details of the system transition in 2027.
Critical Deadlines for Investors
- February 1, 2027 – next semi-annual EEG reduction (approximately −1%); the reduction effective August 1, 2026, has already been implemented.
- December 31, 2026 – the last day for commissioning under the current EEG with a 20-year fixed feed-in tariff.
- December 31, 2027 – End of the temporary declining-balance depreciation.
The lead time for turnkey commercial solar projects is 6–18 months: Anyone aiming to have their system commissioned by December 31, 2026, should not delay submitting their request until the fall.
Consider Direct Investment in Solar Power
A no-obligation initial consultation with a specialized financial advisor from our partner network. We’ll run through your individual scenario, including the tax leverage under Section 7g of the German Income Tax Act (EStG). Contracting party: mediplan Helm e.K., with personal liability of the owner.
Frequently Asked Questions (FAQ)
What is the difference between a direct investment in photovoltaics and a solar fund?
With a direct investment in photovoltaics, you become the owner of a physical photovoltaic system classified as a depreciable movable asset. With a solar fund, you hold a limited partnership interest in a company. Under Section 7g of the German Income Tax Act (EStG), the investment deduction and special depreciation are available only to the owner of the asset—not to the fund unit holder. You should consult a tax advisor to determine whether these provisions apply to your specific situation.
What return will a direct investment in solar power generate in 2026?
The base return on electricity revenue is 6–10% per annum, rising to as high as 10–12% per annum when factoring in tax benefits from IAB and depreciation (Helm Group, 2024 portfolio data). The actual return depends on location, financing security, and operational management. These are historical figures, not guaranteed results.
Can I enjoy the same tax benefits with a subordinated loan as I would with a direct investment?
No. With crowdinvesting via subordinated loans, you are a lender, not the owner of an asset. IAB and special depreciation under Section 7g of the German Income Tax Act (EStG) require ownership of the asset. You receive only interest—without the option to claim depreciation and with a subordinate claim in the event of insolvency.
What are the risks associated with a direct investment in photovoltaics?
The main risks include fluctuations in returns due to weather and location, poor management, regulatory changes, and low liquidity. Unlike with a subordinated loan, the underlying asset remains your property—a total loss, as can occur with crowd investing, is structurally impossible. However, the secondary market for an early exit is limited.
What are the current EEG feed-in tariffs (August 2026)?
The following rates apply to partial feed-in as of August 1, 2026 (through January 31, 2027): up to 10 kWp, 7.70 ct/kWh; 10–40 kWp, 6.66 ct/kWh; 40–100 kWp, 5.44 ct/kWh (Federal Network Agency). The rates decrease by approximately 1% every six months; the next reduction will take effect on February 1, 2027. The feed-in tariff is guaranteed for 20 years from the date of commissioning.
What is the investment tax credit (IAB), and how much tax refund can I expect?
Under Section 7g(1) of the Income Tax Act (EStG), the IAB allows 50% of the estimated acquisition costs to be deducted from taxable income in the previous year—capped at €200,000. For an investment of €400,000 and a marginal tax rate of 45%, this amounts to a tax savings of approximately €90,000. One of the requirements is a profit threshold of €200,000; a tax advisor will determine whether this provision applies.
How liquid is a direct investment in solar power?
Very low. It is an illiquid real-asset investment with a term of 20–40 years. Early exit is only possible by reselling the investment, and the secondary market is limited. Those who need the ability to trade at any time are better off with a solar ETF—though without the tax advantage and with greater price volatility.
How much will a turnkey commercial solar power system cost in 2026?
According to Fraunhofer ISE, turnkey commercial rooftop systems (>30 kWp) cost around 900–1,600 €/kWp, while ground-mounted systems (>1 MWp) cost 700–900 €/kWp. After several months of increases in early 2026, the rise in module prices has leveled off since July 2026. The exact costs depend on size, location, and technology.
Conclusion: Who Should Consider a Direct Investment in Photovoltaics in 2026
A direct investment in photovoltaics is the only type of solar power system that combines true ownership of the asset, full tax leverage, and 20 years of EEG grandfathering. For investors with approximately €100,000 or more in equity and a high marginal tax rate, it is structurally superior—provided that the location, financing security, and operator quality are right.
If you’d like to first understand the general market situation, read the “Photovoltaic Investment” guide. The Logic Energy Investor Model shows how the model is specifically implemented by a provider, and “Photovoltaics as an Investment” compares PV with traditional asset classes.
As a tangible asset investment, a direct investment in photovoltaics combines financial returns with a concrete contribution to the energy transition—and remains tradable through the sale of the system if needed.
Legal Notice: This article is intended solely for general informational purposes and does not constitute investment, tax, or legal advice. Return figures are based on historical data from the Helm Group and are not a guarantee of future results. The contracting party for PV direct investments is mediplan Helm e.K. (a registered merchant with personal liability of the owner pursuant to Sections 1, 17, and 19 of the German Commercial Code (HGB)). For your individual situation, please consult a licensed advisor. All information is provided without warranty. As of August 2026.
References
- Federal Network Agency – EEG Subsidies and Subsidy Rates
- § 7g of the Income Tax Act – Investment Deductions and Special Depreciation Allowances
- § 7 EStG – Depreciation Allowance, Declining-Balance Depreciation
- iShares (BlackRock) – Global Clean Energy ETF Fact Sheet (as of December 31, 2025)
- Yahoo Finance – Invesco Solar ETF (TAN) Performance History
- Ecoreporter – Sonneninvest Deutschland Under Bankruptcy Administration
- AKH-H Attorneys at Law – te Solar Sprint IV / Risk of Total Loss
- pv magazine – Cabinet Approves Drafts of the EEG 2027 and Grid Package (July 29, 2026)
- GÖRG – Working Draft of the EEG 2027
- Finanztip – Feed-in Tariff 2026
- Haufe – Growth Opportunities Act
- Fraunhofer ISE – Current Facts About Photovoltaics (Q1 2026)
- BSW-Solar – Photovoltaic Market Data
Logic Energy Editorial Team. All information is provided without warranty. As of August 2026.
