A recent study has revealed that Germany’s energy transition will require a massive investment of 1,240 billion euros by 2035. However, it is expected to generate growth and is gaining momentum. The country aims to phase out coal-fired power generation by 2038 and recently shut down its last nuclear power plants in April 2023, with a political goal of advancing the coal phase-out. This energy transition necessitates significant investments in expanding renewable energies and transmission networks.
According to the “Energy Transition Progress Monitor” published by EY and BDEW, an estimated 1,214 billion euros in investments will be needed by 2035, with 721 billion euros required by 2030. These staggering sums of investment are essential to achieve the energy transition goals set by policymakers, including increasing the share of renewable energies in electricity generation to 80% by 2030.
The study highlights that the largest portion of these investments will go toward expanding electricity generation from renewable energies, with around 353 billion euros needed by 2030 and a total of 569 billion euros by 2035. Additionally, investments in transmission and distribution networks for electricity and gas are projected to reach 473 billion euros, emphasizing the need for infrastructure development to support the energy transition.
The report also underscores the economic benefits of these investments, noting that they could contribute to significant growth and regional value creation by generating gross added value for manufacturers of capital goods related to renewable energy generation. Despite progress made in the energy transition, there is still a need for increased investments to fully realize its economic potential and achieve the set goals by 2030.
While expanding renewable energy sources like photovoltaics and wind energy showed significant progress in