Energy Newsletter

Spot gas prices in Germany have risen above €60/MWh – approximately 6x more expensive than in the USA. Geopolitical crises (Iran conflict, Ukrainian oil blockade) massively threaten Europe's energy supply. German industry is increasingly positioned as a loser of the energy crisis, with risks to economic growth and competitiveness.

Federal Network Agency warns of insufficient power plant capacities and partial grid overload in 2026. 50Hertz operator recorded over 200 dark calm events in 2025 despite 74% renewable energy share. Power grid bottlenecks and missing secured capacity threaten supply security and require regulatory measures.

Federal Cartel Office warns of excessive market power held by three electricity generators RWE, EnBW, and Leag post-energy crisis. Criticism of EON dominance (75% of grid capacity problems) and conflicts of interest among grid operators. Concentrated market structures could jeopardize energy transition goals and sharpen price risks.

Renewable energy reached record final energy shares in 2025 (23.8%), with wind and solar dominating the power mix (77% on good days). Germany exports electricity but has insufficient storage and flexible capacity for dark calm periods. Massive subsidies (€29.5 billion 2026) and political sabotage complicate systematic expansion.

Vattenfall CEO Borg is exploring construction of five small modular reactors for baseload supply. RWE doubles investments (€35 billion 2026-2031: €17 billion in USA, remainder in Europe renewables). Nuclear energy renaissance and decentralized expansion are positioned as strategic response to supply gaps.