New Gas Power Plants for Germany: Bundestag Approves
As of: July 9, 2026, 6:10 PM
Out of coal, into renewables – the government fundamentally sticks to this. This is to be supplemented with new capacities. What does that mean for the wallets of electricity customers?
Berlin - The Bundestag has approved the plan to build numerous new gas power plants over the next five years. The new facilities are intended to support the coal phase-out and the expansion of green electricity, and to prevent feared gaps in the power supply. Consumers will face additional costs from 2031 for a new levy, which is to finance billions in subsidies for operators.
In parliament, the Union and SPD voted for the plans of Economics Minister Katherina Reiche (CDU). The opposition rejected the bill. In the debate, the AfD warned of billions in costs and renewed its demand for a return to nuclear power. The Greens and the Left criticized that Germany would become even more dependent on gas imports and that the costs were unclear. The Union and SPD defended the project, which now goes to the Bundesrat.
Tenders still in 2026
Tenders for a total of 11 gigawatts of new capacity are to begin this year, with the plants to be connected to the grid by the end of 2031 at the latest. The new facilities will initially burn natural gas, which is associated with the emission of harmful greenhouse gases. By 2045 at the latest, the gas power plants are then to run "climate-neutrally" on hydrogen. This means they must already be planned now so that a switch is possible – the technical term is "H2-ready".
The expansion of green electricity is to continue – by 2030, at least 80 percent of electricity should come from wind, solar, and other renewable energies. The government also reaffirms the goal of phasing out coal by 2038. The Union and SPD consider the new power plants necessary for two reasons: on the one hand, there would otherwise be a "supply gap" from 2031; on the other hand, the gas power plants are to step in during "dark doldrums" when too little wind and solar power is generated. For this, a so-called capacity market is to be created from 2032. That means power plant operators are paid for keeping capacity available that is not currently needed.
In the final debate, deputy Union parliamentary group leader Sepp Müller (CDU) described the power plant law as a "seat belt" for the German electricity supply. SPD energy politician Nina Scheer said one should not make the mistake of building too much gas power capacity. But there should also be no gap.
Billions in costs expected
The subsidy costs are to be passed on to electricity customers from 2031. In its original draft, the federal government assumed 1 to 3 billion euros in 2031 and annual costs of 0.9 to 2.3 billion euros thereafter. However, some changes were made in the parliamentary process that critics say could drive up costs.
As the German Environmental Aid calculates, the bid caps in the auction of new power plant capacities were raised from 173,000 to 244,000 euros per megawatt. According to the association, this could push the costs passed on to electricity customers to more than 4 billion euros in 2031. The Environmental Aid also criticizes that battery storage is disadvantaged as an alternative to new power plants.
Energy industry satisfied
The Federal Association of the Energy and Water Industry, on the other hand, praises the new regulations as a viable compromise. "We need the addition of secured capacity, so it is a good day for Germany as an industrial and business location," explained BDEW head Kerstin Andreae. She welcomed the increase in the maximum bid value because it ensures competition in the tenders and sufficient bids.
The energy company RWE also expressed delight. "What is crucial now is that the EU Commission grants state aid approval quickly and that the auctions can start in the autumn," explained RWE CEO Markus Krebber. "First plants could then go into operation around 2030." The company wants to build three hydrogen-capable gas power plants with around three gigawatts of capacity at its own power plant sites in North Rhine-Westphalia.
Farewell to the South Bonus
The law was amended – after protests from the north and east – from the original plan of a "South Bonus": Initially, it was planned that up to two-thirds of the tendered power plant capacities would go preferentially to the "grid-technical south". This includes the federal states of Baden-Württemberg, Bavaria, Hesse, North Rhine-Westphalia, Rhineland-Palatinate, and Saarland.
Now the South Bonus will only come into effect once one-third of the awards have gone to the north and east. This benefits Berlin, Brandenburg, Bremen, Hamburg, Mecklenburg-Western Pomerania, Lower Saxony, Saxony, Saxony-Anhalt, Schleswig-Holstein, and Thuringia. dpa
