Germany Signals Shift in Renewable Energy Ambitions Amid Cost Concerns
Merz hints at scaling back expansion targets
Germany may scale back its renewable energy rollout as Chancellor Friedrich Merz suggested the country could pursue “a little less” expansion to rein in costs. His remarks come ahead of the release of a long-awaited energy transition monitoring report, set to be published next week.A new reality check for the energy transition
Speaking at a meeting of corporate works councils from energy companies in Berlin, Merz said the upcoming report will provide a reality check for Germany’s climate and energy policies. “This will trigger significant changes in costs,” he noted, stressing that affordability and security of supply remain top government priorities.Hydrogen-ready gas plants no longer required
Merz also confirmed that the government has scrapped the requirement for new gas-fired power plants—intended as backup during low renewable output—to be hydrogen-ready from the start. The move signals a more cautious approach to long-term decarbonisation investments.Balancing grid expansion and renewables
Economy Minister Katherina Reiche, who will present the report, has emphasized that renewable expansion must be better aligned with grid development. She has argued that ambitious renewable targets in past years neglected cost efficiency, creating bottlenecks and higher grid fees for consumers.Climate targets at risk?
Critics warn that slowing down the renewable rollout could undermine Germany’s climate goals, prolong reliance on fossil fuels, and weaken the country’s leadership in green energy. Germany’s current targets aim for renewables to cover 80 percent of power consumption by 2030 and for the power sector to be nearly climate-neutral after the coal phase-out by 2038.A shift in priorities
Merz insisted that a secure and affordable energy supply must take precedence. “If we want to remain an industrialised country, we must have a secure energy supply. For the time being, at least, we cannot guarantee this with renewable energies alone,” he said.Germany has also created a €500 billion special fund to support infrastructure and climate-neutrality projects over the next decade, aiming to reach full carbon neutrality by 2045. The upcoming monitoring report is expected to shape the government’s next steps in striking a balance between ambition, affordability, and reliability.
