Energy Newsletter

German electricity prices have risen to an average of 37.2 ct/kWh in 2026 – five times the 1980 level. While France is quoted at 22 €/MWh, German households pay 93-96 €/MWh, driven by energy transition infrastructure costs and lack of storage capacity. The government announced renewed industrial subsidies, indicating structural market failure.

Germany is developing into a 'shortage economy' in the electricity sector: Hamburg is rationing electricity connections for the first time because distribution grids cannot keep up. The Federal Network Agency is preparing a crisis platform for Q3 2026 – analogous to the gas emergency of 2022. Storage deficit of only 1.7 GW/2.2 GWh jeopardizes supply security during dark doldrums.

RWE's 1.6 GW offshore wind project North Sea Cluster A received DNV certification and entered construction phase – first turbine installed. This megaproject is critical for Germany's energy transition, but also signals that larger offshore capacities will only be available in the medium term. EnBW and RWE are maintaining ambitious expansion plans despite regulatory criticism.

Prominent critics (citing, among others, the Wall Street Journal) established in 2026 that Germany's energy transition has failed: highest electricity prices in Europe, missing grid infrastructure, hundreds of thousands of jobs in industry at risk. The comparison to France's cheaper, stable nuclear power is repeatedly raised – political legitimacy crisis of the energy transition.

EON and E3/DC are leveraging heat pumps, batteries, and charging stations in private households as flexible electricity resources for the wholesale market – customers receive bonus payments. Strategic approach to compensate for storage shortage through demand-side management, but also reveals the necessity of emergency measures given insufficient central storage infrastructure.