I have heard that Germany is using a lot of solar power. I believe Germany is a relatively cloudy place, how is it that they can still generate power? Can this really be economical?

Source: NREL

It is true that Germany receives less solar energy than many regions of the United States. However, less energy does not mean no energy or that solar energy will never be competitive with other sources. Germany still receives sunlight, although not nearly as much as the southwestern U.S. One still generates energy from solar cells on cloudy days--the amount of energy generated is just reduced under such conditions. Germany is a world leader in energy production. In the 1990s, Germany initiated some policies (largely subsidies) that encouraged the construction of solar energy installations. These subsidies helped make solar energy competitive with other energy sources. These subsidies helped solar energy to make inroads and compete with other energy sources. It is yet to be determined how solar energy would fare once those subsidies are inevitably reduced or eliminated. Whenever one switches from using one technology to another, there are some upfront costs involved in that switch. These subsidies are part of that upfront cost. If the subsidies ceased to exist today, solar energy would be much less competitive, but the solar infrastructure is more of a long-term investment. A surprising amount of the cost of solar is associated with red tape.

Source: http://www.forbes.com/sites/toddwoody/2012/07/05/cut-the-price-of-solar-in-half-by-cutting-red-tape/, note that this is from 2012--I could not find more recent figures

In some regions of the U.S., solar energy is already competitive with other energy sources, just as it is in parts of Germany.