Panorama Blick auf eine Landschaft mit großer Solaranlage im Vordergrund und Windkraftanlage im Hintergrund

Renewables Solar, wind and storage: more productive as a hybrid

08.04.2024 8 Reading Time

Hybridization - a growing trend

The capacities for generating electricity from renewable energies have increased considerably in recent years, both in Germany and in Europe, and are set to grow further. However, we are currently experiencing bottlenecks in the transmission grids. This affects not only the large "electricity highways", i.e. the high-voltage transmission grids over long distances, but also the local grid connections through which the electricity from photovoltaic or wind energy plants is fed into the public grids.
However, some of the capacity of these grid connections often remains unused due to weather conditions and the time of day. This is where hybridization comes into play - a strategy in which different types of generation and storage capacities are combined. The different generation profiles allow an existing grid connection to be used better and more efficiently. Hybridization of existing plants can even create new generation capacity without the need to expand the local distribution grid or the transmission grid.
Hybridization has become a trending topic in the energy transition and will continue to gain importance as long as grid connection and grid expansion remain bottlenecks. This opens up interesting opportunities for investors. The aim is to make optimum use of existing resources and at the same time make the energy supply sustainable and efficient.


Existing grid connections of renewable energy systems are used several times to feed in additional electricity. This reduces the average cost of the grid connection, the connection is used more efficiently and more electricity can be supplied. Less grid expansion is required and this bottleneck for the energy transition is simply solved. Combined grid access allows green energy sources to be integrated more quickly.

Benefits for energy policy and operators

1. Optimization of energy generation

Wind turbines and photovoltaic systems have different generation profiles, depending on the location and weather conditions. Wind turbines produce regardless of the time of day, while photovoltaic systems produce during the day when the weather is sunny. By combining these technologies, daily and seasonal production fluctuations are partially balanced out, resulting in more continuous power generation.

2. Efficient use of grid connections

Every grid connection has a maximum active power. In Germany, the full load time for photovoltaics is around 1,000 hours per year, depending on the location, while it can be up to 2,500 hours per year for onshore wind turbines at suitable locations. The combination of wind and photovoltaics results in an average capacity of around 3,200 full-load hours per year. This even distribution throughout the day and year improves the utilization of existing grid connections and reduces unused power peaks.

3. Grid stability and capacity expansion

Hybridization helps to improve grid stability and use capacities more efficiently. By smoothing the generation profiles, fluctuations are balanced out and additional generation capacity is created without the need for complex and costly grid expansion.

4. Higher revenues through capture prices

Marketing the combined production profile enables higher electricity and PPA prices on average. At the same time, volume risks in Power Purchase Agreements (PPAs) are significantly reduced. PPAs are direct power purchase agreements with consumers or suppliers where state grid feed-in tariffs are waived.

The following diagram shows how the electricity generation profiles of wind energy and photovoltaics ideally complement each other over the course of the day and year:
Die Grafik zeigt einen Vergleich der Stromproduktion von Photovoltaikanlagen und Windkrafträdern im Tages- wie Jahresverlauf. Zu erkennen ist, dass sich die beiden Energieträger in ihren Produktionspeaks komplementär ergänzen.
The hybridization of wind energy with photovoltaics is a promising strategy for improving energy generation. However, it alone is not enough to guarantee a stable base load, especially on the smaller scale of individual systems. There are always times when neither the sun shines nor the wind blows - the so-called dark doldrums. With hybridization, it is crucial to maximize the full load hours of the entire system and to make optimum use of the existing grid connection. Providing a base load from renewables requires a strong pan-European grid infrastructure and electricity storage capacity. Nevertheless, hybridization helps to make better use of the existing grid infrastructure and enables a more even local feed-in.

Regional differences and choice of location

In principle, all locations are suitable for hybrid systems, provided there are no structural or technical obstacles. However, the effectiveness depends heavily on the potential of the respective generation types on site. By sharing the grid connection, the specific costs of the systems can be reduced. However, it is important to ensure that each technology is an economically viable project in its own right in order to maximize the benefits.

Ideally, the generation profiles of the respective technologies should be combined in such a way that they overlap as little as possible and do not generate maximum output at the same time. This requires careful planning and optimization depending on the location. This is because it is by no means a given that an even distribution of the generation profile must be 50:50 or that the installed capacity of the various technologies must be identical. These ratios can also deviate from one another.

A study has illustrated this using three comparative locations for wind and solar capacity in Portugal. Although the ratios of wind and solar energy can differ greatly from location to location, the correlations are very low or even negative both on a daily and annual basis. However, the greater the complementarity, the greater the potential for hybridization.¹
Grafik zur Illustration von hybrider Stromerzeugung anhand von drei Beispielen aus Portugal.
It is not absolutely necessary for both types of generation to be erected directly next to each other at the same location. This could even be a hindrance, for example if photovoltaic systems are temporarily shaded by neighboring wind turbines or are built close to settlements, so that the addition of wind turbines would not even be eligible for approval. All that is important is a certain proximity in order to make efficient use of the advantage of the existing grid connection.

Here is a hypothetical but practical example: a photovoltaic power plant north-east of Berlin with a maximum output of 130 megawatts (peak). The project developer had a cable route more than 20 kilometers long planned, approved and built in order to transport the generated electricity to the grid connection point. However, this infrastructure is practically never used, especially at night. By building a wind farm with five turbines and a nominal output of 30 megawatts nearby, the grid connection can now be used much better and more efficiently. All that was required was the addition of just under one kilometer of extra cable.

Supplementing existing systems versus planning new hybrid systems

On the one hand, hybridization can be carried out by retrofitting an existing wind turbine with a photovoltaic system or vice versa. On the other hand, a hybrid system can also be planned and developed as such on the drawing board from the outset.

The most common practice at present is to hybridize existing systems retrospectively. This is particularly due to the fact that grid capacities are limited in many regions and there is therefore less and less opportunity to create additional renewable energy capacities other than in this way. It also makes more practical sense at present, as wind development takes considerably longer than photovoltaic development and the development schedule would otherwise be determined by the wind project, meaning that the first returns on capital would not come until much later. Hybridization offers an opportunity to use additional renewable energy sources without having to extensively expand the grid. This allows the use of the existing grid connection to be optimized and the profitability of the entire ensemble to be increased.

This is particularly relevant when grid capacities are scarce overall, but an existing grid connection cannot be used optimally due to fluctuating power generation. In the future, however, it is to be expected that hybridization will also be increasingly taken into account when planning new systems in order to use the grid infrastructure more efficiently from the outset.

"However, the biggest advantage of hybridization is...

... that it speeds up the expansion of capacity by avoiding new connections. The resources from planning and approval to the construction costs of a new connection can thus be used for the expansion of renewable energy generation. Hybridization is therefore likely to increase significantly in the coming years and contribute significantly to the energy transition."
Dr. Nicole Arnold
Member of the Management Board

"However, the biggest advantage of hybridization is...

... that it speeds up the expansion of capacity by avoiding new connections. The resources from planning and approval to the construction costs of a new connection can thus be used for the expansion of renewable energy generation. Hybridization is therefore likely to increase significantly in the coming years and contribute significantly to the energy transition."

Battery storage as an additional factor

Hybridization does not always refer to the combination of different types of generation. Instead, an electricity storage technology is often added as a hybrid component - in practice usually a battery storage system, often in conjunction with photovoltaics. This is particularly useful if systems have to be curtailed due to temporary overload without financial compensation from the grid operator or if the expansion of renewable energies is already at an advanced stage and systems are generating ever lower revenues due to cannibalization effects.

The electricity produced can then be stored and fed into the grid at a later point in time when the system is producing little or not at all. This concept is particularly relevant for photovoltaic projects. The high correlation within this asset class leads to increasingly lower prices for the electricity generated. Load shifting optimizes the utilization of the grid connection and the electricity can be sold at times of day when higher prices can be realized.

The combination of photovoltaics and battery storage offers clear advantages compared to wind-photovoltaic hybrid systems. These include lower approval hurdles and a smaller area requirement. Wind turbines must meet high standards for the protection of flora and fauna, and distance regulations must be observed. This regularly leads to complex and lengthy approval processes. There can also be resistance from local residents. In contrast, very few people are bothered by inconspicuous battery storage systems, and there is also no need to worry about temporary shading of photovoltaic systems if the distance is too short.

However, battery storage systems can also serve as a useful addition to existing wind-photovoltaic hybrid systems. This is particularly the case when simultaneous generation peaks of wind and solar energy regularly mean that the electricity generated cannot be fully fed into the grid due to a lack of grid connection capacity. Although this approach has rarely been seen in practice to date, it could become increasingly widespread as battery prices fall.

An example from northern Spain shows that this was the case for around six percent of the electricity generated. Although the overlapping production peaks over the year are not particularly large, it can still make sense to store this surplus electricity as an additional benefit of the battery and feed it into the grid at a later time. This contributes to better utilization of the grid connection capacities and overall greater grid stability. So far, however, the main benefit of battery integration has clearly been load shifting.

Whether such a three-way combination makes economic sense at all depends on various factors, including battery costs and the actual overlap of wind and solar power. In any case, battery storage can significantly increase the performance of hybrid systems, depending on the specific design.

Opportunities and challenges for institutional investors

The hybridization of renewable energies opens up new opportunities and possibilities for institutional investors, but also brings challenges.

More stable yields

Hybrid systems can often provide a more stable source of income. By combining different types of generation and/or using battery storage, fluctuations in the electricity yield can be balanced out. The electricity yield and therefore also the potential income are therefore more stable and reliable. This can fundamentally increase the attractiveness of investments in renewable energies, especially for long-term institutional investors such as pension funds and insurance companies that value stable cash flows. In addition, lower fluctuations in electricity yields put the operator in a better negotiating position when structuring PPAs, as there are fewer supply shortfalls.

Economies of scale

Institutional investors can also benefit from economies of scale if they invest in hybrid plants. As these are different types of generation, the economies of scale on the production side are limited. However, the main advantage is the shared grid connection and therefore lower specific costs for both technologies, as the grid connection is used more effectively and the costs arising from the grid connection are spread over "more kilowatt hours". This reduces the electricity generation costs.


The hybridization of renewable energies diversifies into different types of generation and technologies, both in terms of returns and risks. This can improve the overall risk/return profile of the portfolio and increase overall stability.

Rapid expansion of capacity

In some places and with increasing frequency, it will only be possible to create new renewable energy capacities in Germany and Europe in a relatively short period of time through hybridization, because otherwise there will be a lack of existing grid connection options. The necessary approval procedures are often lengthy and construction capacities are limited. As the approval procedures and the construction of a photovoltaic plant are usually much faster than for wind energy plants, this advantage is most effective when an existing wind power plant is hybridized by the addition of photovoltaics.

In practice, as already mentioned, it is currently more likely to be the operators of an existing plant who subsequently hybridize it by adding an extension. Nevertheless, new investors and asset managers are also actively looking for potential for hybrid plants that can and want to "jump to the side" of the operator of an existing plant. An interesting market environment will develop in the coming years.

However, the challenges should not be underestimated. The development of hybrid systems often requires complex planning and coordination, as different components have to interact with each other. This can lead to higher planning and implementation costs. Investors must therefore ensure that they have the necessary expertise and resources to successfully implement hybrid projects. Regulatory issues can also pose a challenge, as they vary greatly depending on the region and country.

Summary and forecast

The hybridization of wind and photovoltaic systems is still in its infancy, but it holds promising potential for optimizing energy generation and making efficient use of the grid infrastructure. In the future, technological advances and innovations in the field of battery storage will further increase the performance of hybrid systems and reduce costs. At the same time, control technology and technical advances in the management of such complex systems will play a crucial role. These developments will help to store surplus energy efficiently and release it when needed.

Hybridization opens up considerable potential for investors. This is also becoming increasingly relevant for energy policy. With the growing share of renewable energies in the electricity market, hybridization - especially in combination with battery storage - is becoming increasingly important to ensure a continuous power supply and successfully drive forward the energy transition. Investors can benefit from this emerging market segment and at the same time contribute to a sustainable energy supply. In short, this is where the action will be in the upcoming years.
¹António Couto, Ana Estanqueiro: „Wind power plants hybridised with solar power: A generation forecast perspective“, Journal of Cleaner Production, 15.10.2023,