Germany's €696 Billion Energiewende: The Lessons Britain Refuses to Learn

In 2000, Germany launched the Energiewende (energy transition), an ambitious plan to phase out nuclear power and coal while building a renewable energy system. A quarter-century later, the results are in: €696 billion spent, nearly 200,000 companies closed in 2024 alone, and electricity prices among the highest in Europe.

Britain is following the same playbook.

This isn’t an argument against renewable energy. Germany now generates 60% of its electricity from renewables, a genuine achievement. But the how matters as much as the what, and Germany’s simultaneous nuclear phaseout turned what should have been a climate success story into a cautionary tale about energy policy driven by politics rather than engineering.

The Timeline: From Ambition to Regret

2000-2002: The First Nuclear Phaseout

The story begins in 2000 with the Renewable Energy Sources Act (EEG), which established generous feed-in tariffs for wind and solar. Grid operators were legally required to buy renewable electricity at fixed prices, well above market rates.

Two years later, Chancellor Gerhard Schröder’s coalition passed the Atomgesetz (Nuclear Act), agreeing with utilities to limit nuclear plant lifespans to 32 years. Germany’s 17 nuclear reactors would close by roughly 2022.

2010: The Reversal

By 2010, the economics looked different. Chancellor Angela Merkel’s government extended nuclear plant licenses by 8-14 years, recognising that phasing out both nuclear and coal simultaneously was economically and technically problematic.

2011: Fukushima Changes Everything

Then came Fukushima. Within days of the Japanese tsunami, Merkel reversed course. Germany immediately shut down 40% of its nuclear capacity and committed to closing the rest by 2022 (later extended to April 2023).

The decision was political, not technical. Germany faces no tsunami risk. Its reactors were different designs. But public sentiment, shaped by decades of anti-nuclear campaigning, made continued nuclear operation politically impossible.

On April 15, 2023, Germany closed its last three nuclear reactors: Emsland, Isar II, and Neckarwestheim II.

The Bill: €696 Billion and Counting

According to a 2024 study by Jan Emblemsvåg in the International Journal of Sustainable Energy, Germany’s Energiewende has cost €696 billion: €387 billion in infrastructure investments plus €310 billion in subsidies.

That figure is contested. The Fraunhofer Institute criticized aspects of the methodology, arguing the analysis doesn’t adequately account for alternative scenarios. But even more conservative estimates put costs in the hundreds of billions. Former Economy Minister Peter Altmaier estimated the transition could reach €1 trillion by the 2030s.

That’s just the start. Grid expansion to connect northern wind farms to southern industrial centres will require another €651 billion by 2045, according to analysis by the Macroeconomic Policy Institute. Germany currently spends €15 billion annually on grid expansion; meeting the 2045 target requires doubling that to €34 billion per year.

The EEG surcharge, which funded renewable subsidies through consumer bills, peaked at 6.5 cents per kWh in 2021, accounting for roughly one-quarter of household electricity prices. The government eliminated the direct surcharge in July 2022, shifting costs to the federal budget. The subsidies didn’t disappear; they just moved to general taxation.

Annual renewable support costs now reach €23 billion, paid by taxpayers rather than electricity consumers. It’s the same money, just collected differently.

The Price: Europe’s Most Expensive Electricity

Germany reported the highest household electricity prices in Europe in the first half of 2025: €38.35 per 100 kWh, according to Eurostat. Belgium paid €35.71, Denmark €34.85.

For industry, the picture is similar. German companies paid 23.3 cents per kWh in 2024, about 25% above the EU average of 18.7 cents. Only Ireland and Cyprus were more expensive.

The France Comparison

France, which kept its nuclear fleet, tells a different story. French wholesale electricity prices averaged €46 per MWh in the first half of 2024, compared to Germany’s €68 per MWh. That’s a 48% price difference.

Looking ahead to 2026, analysts expect French prices at €58 per MWh versus €88 per MWh in Germany. Nuclear generation in France increased from 320 TWh in 2023 to 361 TWh in 2024 as EDF addressed corrosion issues. France now operates 57 reactors, providing nearly 65% of its electricity.

A 2024 analysis found that if Germany had kept its nuclear plants operating, average electricity prices would have been 23% lower (€18 per MWh cheaper), and 94% of power generation could have been emission-free instead of the current 61%.

That’s not hypothetical. It’s the price of ideology over engineering.

The Industrial Exodus

High energy costs are driving German companies abroad. According to the German Chamber of Commerce and Industry (DIHK), 51% of companies with at least 500 employees are either considering relocation or have already begun moving operations. Among energy-intensive industries, 45% are doing the same.

These aren’t idle threats. In 2024, Germany recorded 196,100 company closures, the highest figure since 2011. That’s a 16% increase year-on-year. In energy-intensive industries alone, 1,050 companies closed, a 26% annual increase.

The Big Names Leaving

BASF, the chemical giant, is cutting 2,600 jobs in Germany while investing €10 billion in a new chemical complex in Guangdong, China.

Volkswagen faces potential job cuts of up to 30,000 in Germany, while expanding investment in China.

Bosch announced plans to cut 7,000 German jobs as it increases investment in China’s e-mobility sector.

Germany’s GDP fell by 0.2% in 2024, extending 2023’s 0.3% decline. Europe’s largest economy has now registered negative annual growth for five consecutive quarters.

Energy costs aren’t the only factor, but they’re significant. The cessation of Russian gas imports disrupted Germany’s industrial base. But the nuclear phaseout, completed while the gas crisis was still acute, made everything worse.

The Grid Challenge: Physics Doesn’t Care About Politics

Germany’s renewable success created a new problem: most wind capacity is in the north, but most demand is in the south and west. Power surpluses in northern states can’t reach deficit areas because transmission infrastructure hasn’t kept pace.

Curtailment: Throwing Away Electricity

In 2024, Germany curtailed 1,389 GWh of solar generation, a 97% increase from 2023. Bavaria, with its high solar capacity, accounted for 986 GWh of curtailed generation. The grid couldn’t absorb midday solar peaks.

Total renewable curtailment cost €554 million in 2024. When generation is reduced, generators receive compensation for power they didn’t produce. Those costs pass to consumers.

Overall, curtailment affected 3.5% of total renewable generation in 2024. That sounds small until you realise it’s 19 TWh of wasted electricity, equal to 4% of Germany’s total annual generation.

The North-South Problem

Four direct current “power highways” were planned to bring northern wind power to southern industrial centres. They were scheduled for completion by end of 2022, coinciding with the nuclear phaseout.

By the end of 2020, only 1,600 kilometres of the planned 7,783 km had been completed. The approval process takes 5-10 years, often extended by administrative issues and public opposition. Visual impacts, property values, and perceived health risks generate significant local resistance.

Nuclear plants sit where the power is needed. Wind farms sit where the wind is. The grid cost of connecting them is enormous, and Germany is only beginning to pay it.

What About Coal? The Unexpected Outcome

Critics predicted Germany would burn more coal after closing nuclear plants. They were wrong.

Coal-fired generation fell from 274 TWh in 2014 to 105 TWh in 2024, the lowest level in 60 years. Fossil power sources contributed 210 TWh in the final year of nuclear operation, dropping to about 160 TWh by April 2024.

Germany’s emissions dropped by about 10% in the year after the nuclear exit, driven by renewables expansion and reduced energy demand.

This is genuinely good news. But it doesn’t vindicate the nuclear phaseout. Germany could have reduced coal use faster by keeping nuclear plants open, achieving the same renewable growth without the industrial exodus or price spike. Nuclear power remains one of the safest forms of energy generation, with far fewer deaths per terawatt-hour than coal or even renewables.

Public Opinion: 51% Call It a Mistake

A survey by Verivox, conducted around the one-year anniversary of the nuclear exit, found that 51% of Germans agreed “the phase-out of nuclear power was a mistake.”

That’s a remarkable shift in a country where anti-nuclear sentiment has been mainstream since the 1970s. When even Germans are questioning the Energiewende, the rest of Europe should pay attention.

Friedrich Merz, leader of the Christian Democratic Union (CDU) who won the 2025 election, campaigned on nuclear revival, proposing construction of new small modular reactors (SMRs).

Whether Germany can reverse course remains to be seen. Reopening closed reactors is technically and economically challenging. But the political consensus that nuclear is finished appears to be cracking.

Britain’s Path: Déjà Vu

The UK faces a similar choice. We’ve allowed our nuclear fleet to decline from 100 TWh in 1998 to 41 TWh in 2024. We import 40% of our energy, costing £24.3 billion in 2024. We’re heavily investing in offshore wind while our remaining nuclear plants approach end-of-life.

The similarities are striking:

Declining nuclear: Germany phased it out intentionally; Britain is managing decline through inaction
Renewable expansion: Both countries are rapidly building wind and solar
Import dependency: Britain imports energy; Germany increasingly imports French nuclear electricity
Industrial competitiveness: High energy costs are affecting both countries
Grid challenges: Both need massive grid investment to integrate renewables

The UK government has committed to new nuclear (Hinkley Point C, Sizewell C, potentially SMRs). But construction timelines are long, and the gap between declining capacity and new build is widening.

Meanwhile, we’re following Germany’s playbook: close old nuclear, build renewables, deal with grid issues later, hope electricity prices don’t drive industry abroad.

The Lessons Britain Should Learn

Germany’s Energiewende offers three clear lessons:

1. Don’t Phase Out Nuclear While Building Renewables

Nuclear provides baseload power and grid stability. Wind and solar provide variable power. Phasing out nuclear while scaling renewables means either burning more gas (emissions) or massive grid investment plus storage (expensive).

Germany tried to do both simultaneously and ended up with the most expensive electricity in Europe. France kept nuclear, has cheaper electricity, lower emissions, and isn’t losing industrial capacity.

2. Grid Infrastructure Takes Decades

Renewable energy is only as useful as the grid that connects it. Germany’s north-south transmission lines were supposed to be ready by 2022. Most still aren’t built.

Britain’s grid is already struggling. National Grid ESO estimates we need £100+ billion in grid investment over the next decade. Planning that around renewable expansion, not fossil fuel replacement, is critical.

3. Industrial Competitiveness Matters

Energy-intensive industries need cheap, reliable power. If they can’t get it domestically, they’ll leave. Nearly 200,000 German companies closed in 2024, many citing energy costs. BASF, Volkswagen, and Bosch are moving operations to China.

Britain’s manufacturing sector is already small compared to Germany’s. We can’t afford to lose what remains because electricity is too expensive or unreliable.

The Uncomfortable Truth

Germany’s renewable achievement is real: 60% of electricity from wind, solar, and biomass is impressive. No country that size has built renewables faster.

But the simultaneous nuclear phaseout was a mistake. Germany could have achieved the same renewable growth while keeping nuclear plants open, resulting in lower emissions, lower costs, and better industrial competitiveness.

Instead, they spent €696 billion, lost nearly 200,000 companies, and ended up with electricity prices 48% higher than France.

Britain is watching this unfold and following the same path. We’re phasing out nuclear through inaction, betting everything on renewables, and hoping the grid, costs, and industrial competitiveness somehow work out.

Germany’s experience suggests they won’t.

Sources and Further Reading

Primary Sources

Emblemsvåg, J. (2024) - “What if Germany had invested in nuclear power?” International Journal of Sustainable Energy
Fraunhofer ISI - Critical response to Emblemsvåg study
Eurostat - Electricity Price Statistics (First half 2025)
Bundesnetzagentur - Growth in Renewable Energy in 2024
ZEW Mannheim - German Economy Lost Close to 200,000 Companies in 2024
Macroeconomic Policy Institute (IMK) - Grid expansion costs €651 billion by 2045

Background Analysis

Clean Energy Wire - Q&A: Germany’s Nuclear Exit One Year After
Clean Energy Wire - How Much Does Germany’s Energy Transition Cost?
Clean Energy Wire - The History Behind Germany’s Nuclear Phase-Out
World Nuclear Association - Germany’s Energiewende

This article focuses on energy policy outcomes, not national characteristics. Germany’s renewable achievement is genuine. The simultaneous nuclear phaseout was the mistake. Britain should learn from both.