Energy Newsletter

In July 2026, wind and solar energy cover over 70% of German electricity demand for the first time – a milestone of the energy transition. At the same time, critical consequences are emerging: negative electricity prices are increasing (299 hours with negative prices H1 2026), grid congestion requires rising redispatch costs, and planned electricity supply security may no longer be guaranteed from 2028 onwards. The expansion of renewable energy is proceeding according to plan, but is increasingly colliding with grid infrastructure and storage capacity.

German households and industry pay an average of 38.7 cents/kWh in 2026 – the highest prices in Europe after Ireland. Causes include the loss of Russian gas contracts (prices 5x higher), rising network charges due to transmission system operator expansion (6.5 billion euros in subsidies 2026), and storage/flexibility premiums. Large industrial companies are threatening to relocate production abroad, while the state spends 17.2 billion euros to dampen electricity prices.

RWE reaches agreement with Trump administration to pay 1.22 billion dollars to abandon planned US offshore wind projects – the fifth similar deal offer from the USA to energy companies. This withdrawal signals geopolitical risks for European green energy investments and could force further European companies to reconsider. Strategically, a decoupling between US and European energy transition strategy is becoming apparent.

Transmission system operator Amprion warns that current security standard levels cannot be maintained in all scenarios from 2028 onwards. The Federal Network Agency is preparing for multi-week bottlenecks and plans to reduce industrial production if necessary. Power grid expansion (SuedLink, Ostbayernring, Ultranet) is ongoing, but is falling behind demand from electrification and heat pumps – a structural bottleneck for decarbonization and AI infrastructure.

EnBW sells its energy services portfolio with approximately 200 plants and 150 employees to Cologne-based RheinEnergie – the largest deal for Cologne in the decade. Consolidation among Big Four utilities (E.ON, RWE, EnBW, Vattenfall) is driven by regulatory pressure and profitability issues. At the same time, CEOs such as Leonhard Birnbaum (E.ON) and Vattenfall's chief criticize the energy transition as too costly and call for a course correction – a sign that traditional companies see their business models under pressure.