Abstract This study presents and demonstrates a methodology for calculating the economic potential of photovoltaic installations in urban areas including the previously often disregarded potential on building facades. The analysis of a 2 km2 urban area has shown that building facades there provide almost triple the area of building roofs. However due to non-optimal inclination and orientation, they receive only 41% of the total irradiation. From this, the economic potential under present market conditions was calculated, resulting in 17% of all analyzed building surfaces, i.e. 0.3 km2 of roof surfaces being economically exploitable for photovoltaic installations already now which corresponds to an installed capacity of 47 MWp. Considering further a material substitution from the building integration of the photovoltaic installations, an economic potential of up to 56 MWp or 0.4 km2 results, of which up to 6 MWp or 0.04 km2 are economically installable on building facades. Facade-mounted installations would then account for 13% of the economic potential. The calculation of an economic potential and additionally considering the material substitution from building integration both constitute an extension to many existing renewable energy potential studies just focusing on the technical potential. However, only the economic potential allows forecasts of the future diffusion of this technology.