Understanding the difference between PV and solar thermal in Germany is essential for homeowners and businesses looking to invest in renewable energy. While photovoltaic systems (PV) generate electricity, solar thermal systems convert sunlight into heat. Both technologies play a key role in Germany’s energy transition, but they differ significantly in design, application, and economic viability.

This article offers a clear explanation of how each system works and which solution is best suited to various needs.

What Is the Difference Between PV and Solar Thermal in Germany?

At its core, the difference between PV and solar thermal in Germany lies in the type of energy each system produces—electricity or heat.

PV systems convert sunlight directly into electricity, whereas solar thermal systems use solar energy to heat water or a heat transfer fluid.

This distinction is particularly important in Germany. With its temperate climate, rising energy costs, and generous government incentives, homeowners need to make a clear decision on whether they can benefit more from solar power or solar heat in the long run.

PV systems are often more versatile, supplying power for household use, heat pumps, or electric vehicles. Solar thermal systems, on the other hand, offer high efficiency in meeting heating and hot water needs.

Technical Basics: How Do PV and Solar Thermal Systems Work?

How a Photovoltaic System Works?

A PV system converts sunlight into electricity using solar cells—usually made of silicon—which activate when struck by photons and generate electrical voltage. The key components of a PV system in Germany include:

• Solar modules on the roof (monocrystalline or polycrystalline)
• An inverter that converts DC (direct current) into AC (alternating current)
• Battery storage to maximize self-consumption
• Grid feed-in point to export surplus electricity to the public grid

Thanks to Germany’s feed-in tariff, exported solar electricity is compensated, improving the overall economic return.

How a Solar Thermal System Works?

A solar thermal system captures sunlight to heat a thermal transfer fluid. This heat is then transferred via a heat exchanger to a hot water tank or a home heating system. Main components include:

• Solar collectors (flat-plate or evacuated tube)
• Pump and pipe system
• Hot water storage tank
• Control unit to manage energy flow

Solar thermal systems can reach efficiencies of up to 70% and are especially beneficial in homes with high hot water demand.

Key Differences Between Photovoltaic and Solar Thermal Systems

Type of Energy and Usage

The fundamental difference:

• Photovoltaics generate electricity to power devices, heat pumps, or electric cars.
• Solar thermal produces heat, ideal for water heating and space heating.

In Germany’s long heating season, solar thermal systems can significantly reduce heating costs. PV systems reduce electricity bills and are financially attractive due to self-consumption and incentives.

Space Requirements and Efficiency

Solar thermal systems generally offer a higher energy yield per square meter, as converting sunlight to heat is less loss-prone than generating electricity. However, PV systems require more surface area but offer broader use cases.

For properties with limited roof space, it’s important to evaluate whether electricity or heat is a priority—or consider combining both technologies.

Economic Viability and Incentives

• PV systems in Germany: Supported through the EEG (Renewable Energy Act), offering feed-in tariffs and VAT exemption for small systems.
• Solar thermal systems: Eligible for BAFA and KfW grants, especially when replacing or upgrading heating systems.

Both technologies typically have payback periods of 7 to 12 years, depending on self-consumption, energy prices, and solar exposure.

Economics and Costs in the German Context

Investment and Return

As of 2025:

• A standard 10 kWp PV system costs around €13,000–€18,000, or up to €20,000 with storage.
• A solar thermal system costs about €5,000–€7,000 for hot water, and up to €10,000 with heating support.

Both systems have lifespans over 25 years, with solar thermal generally requiring less maintenance.

Subsidies and Tax Benefits

German homeowners benefit from several incentive programs:

• Feed-in tariffs for PV power under the EEG
• BAFA grants up to 30% for solar thermal installations
• KfW loans for energy-efficient renovations
• VAT exemption for PV systems up to 30 kWp

Combining these programs can significantly shorten the amortization period.

Energy Savings and Self-Consumption

• A 10 kWp PV system generates about 9,000 kWh/year, covering most electricity needs of a typical household.
• A solar thermal system can meet up to 60% of hot water and 30% of heating demand.

The best economic results often come from combining PV electricity with a heat pump, using solar power efficiently for heating.

Climate Conditions and Regional Variations

Germany receives moderate sunlight by European standards, but modern systems still achieve excellent performance.

• Southern Germany (e.g., Bavaria, Baden-Württemberg): over 1,200 kWh/m² annual solar irradiation
• Northern Germany: approx. 1,000–1,100 kWh/m²

Advanced technologies—such as bifacial PV panels or vacuum tube collectors—ensure strong performance even in diffuse light.

Laws like the Building Energy Act (GEG) and local solar mandates are also accelerating adoption.

Hybrid Solutions: Combining PV and Solar Thermal

How Do Hybrid Systems Work?

PVT systems integrate both photovoltaic and thermal technologies into one module, converting sunlight into both electricity and heat simultaneously.

Benefits:

• Ideal for limited roof space
• Higher total energy yield
• PV cell cooling improves electricity output

Drawbacks:

• Higher upfront costs
• More complex installation
• Lower efficiency compared to separate, specialized systems

Alternative: Separate PV and Solar Thermal Systems

Many homeowners prefer installing both systems independently:

• PV for electricity
• Solar thermal for hot water and heating

This approach allows for optimal placement and maximum flexibility. When paired with an energy management system, the two systems can work together seamlessly.

Looking Ahead: Solar Energy as a Cornerstone of the Energy Transition

Germany has set ambitious goals to become climate-neutral by 2045. Both PV and solar thermal are indispensable to achieving this vision.

• PV systems are transforming the power sector.
• Solar thermal reduces CO₂ emissions in heating, the largest energy consumer.

Emerging technologies such as PVT collectors, smart storage, and district energy solutions will further integrate and optimize these systems.

The difference between PV and solar thermal in Germany lies in the form of energy they produce—electricity vs. heat—but together, they form a perfect synergy.

To actively support the energy transition, homeowners should assess their energy needs, roof space, and available subsidies.

PVPro Solar GmbH offers customized consulting, planning, and installation services for solar systems across Germany.

Visit PVPro Solar GmbH to learn how you can power your property sustainably with solar electricity or heat.

Request a consultation now and take advantage of government incentives!

Which system is more efficient – PV or solar thermal?

Solar thermal systems typically achieve higher efficiency in heat production, while PV is more versatile since it generates electricity. The better option depends on your energy needs, roof space, and usage patterns.

Can you install both PV and solar thermal on one roof?

Yes. You can combine both technologies either through separate systems or hybrid (PVT) modules. Proper planning is crucial to ensure maximum efficiency.