German solar panel installations fell by 42.4 percent last year to 1.9 gigawatts (GW), data from energy regulator, the Bundesnetzagentur, showed.
The government had allowed up to 2.6 GW of new units to receive feed-in tariffs each year, showing that efforts to rein in the expansion of solar have been successful.
A green energy law last summer set the caps on new builds as well as requiring operators to align their output volumes more directly with the market rather than relying on subsidies.
Germany’s total solar capacity now stands at 38.2 GW, the figures showed.
In theory, that goes a long way towards solar alone meeting national power demand during periods of sunny weather, but a typical winter’s day requires 70 GW of capacity.
In a related development, the expansion of solar energy has become a problem for traditional utilities, whose gas and coal plants run for fewer hours as energy from solar and wind sources takes priority when being fed into the power grid.
New solar additions in 2013, totaling 3.3 GW, were down 55 percent from 2012, a record year with 7.6 GW of new capacity.