German chancellor Friedrich Merz during his first official visit to the European Commission. Photo: EC Audiovisual Service
Dossier
Cutting costs, backing industry, strengthening supply security – and keeping voters on board

Preview 2026: Will Europe’s largest economy stay the course on climate?

In 2026, Germany's government under chancellor Friedrich Merz must end the uncertainty prevailing during its first months in office. It can no longer delay major climate and energy policy decisions to put the country on track to climate neutrality by 2045, and has pledged to reset the energy transition by lowering costs and improving resilience. However, it has yet to present crucial reforms in electricity, industry, transport, and buildings. Patience across the economy and society wears thin, while geopolitical tensions, trade disputes and a sluggish economy are increasing pressure to deliver results ahead of state elections where the far right could make significant gains. If Europe's largest economy does not stay the course on climate, the EU will struggle to take ambitious long-term decisions planned for next year. This dossier previews Germany’s and the EU's climate and energy transition in 2026, and features interviews with experts on their expectations for the year ahead.

ANALYSES

Merz government must deliver on key energy projects as patience wears thin

Photo: Bundesregierung / Kugler

The economic reset promised by chancellor Friedrich Merz remains a work in progress at the turn of the year, with many major climate and energy policy decisions still pending. Industry leaders warn of mounting frustration after his commitment to put competitiveness ahead of climate ambition, while environmental groups fear a weakening of climate targets and voters remain unconvinced. Pressure on his government is growing to deliver, but a fragile coalition, five state elections and the risk of a far-right surge are increasing the complexity of effective policymaking in 2026.

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2026 set to shape the future of the EU’s climate and energy architecture

Climate and energy policy in the EU will enter a decisive phase in 2026, as the European Commission prepares post-2030 rules and reviews emissions trading, and member states and the European Parliament negotiate the next long-term budget. With key elections looming in major member states in 2027 and pressure mounting over costs and competitiveness, decisions taken next year could determine whether the EU enters the 2030s with a climate and energy architecture ambitious enough to help reach international targets. 

Read the article here.

Special Dispatch Europe | Preview 2026

Photo: EU.

After a year marked by rollbacks of existing climate rules – from weakening deforestation regulations and company sustainability reporting obligations, to postponing emissions trading in transport and buildings – the EU will begin looking forward in its climate debates soon. In countries across the union, meanwhile, governments are focussing on the implementation of the transition, with legislation covering topics from renewable energy support to decarbonising household heating.

Clean Energy Wire’s authors in Warsaw, Brussels, Zadar and Milan, as well as those in the CLEW newsroom in Berlin, weigh in on their expectations for the biggest climate and energy stories in 2026.

Read the Special Dispatch Europe here.

INTERVIEWS

Security of supply in focus as Germany must move fast on new gas power plants – analysts

Photo: RWE

Germany will need rapid legislative progress in 2026 to secure new gas electricity generation capacity and keep its coal phase-out on track, analysts from Aurora Energy Research said. Security of supply will be back in the focus next year, as deteriorating market conditions for coal assets could push plants out of the market sooner than planned, said Nicolas Leicht, project leader of the advisory team, in an interview with Clean Energy Wire. Until now, the government coalition has a mixed track record on climate and energy policy, added Lukas Günner, energy market expert of the German research team.

Read the interview here.

Germany urged to fight harder to protect EU emissions trading ambition – researcher

Photo: BASF SE

As pressure mounts to weaken EU climate rules, Germany will have to decide whether it is prepared to defend the ambition of the European Union’s emissions trading systems, said Philipp Jäger, senior policy fellow at the Jacques Delors Centre think tank. The German government’s priorities have clearly shifted to tackling economic concerns and it remains to be seen how much political capital it will invest on EU climate policy.

Read the interview here

Germany should use electricity market reform for efficient renewables additions – researcher

Photo: European Union, 2023.

Reducing energy costs was the order of the day as Germany’s new government took office in May 2025, but the year ahead may be marked more by structural reforms than cost interventions, said Sylwia Bialek-Gregory from the Institute of Energy Economics (EWI). Looming power market reforms are a clear opportunity to boost the reliability and affordability of the energy transition, the scientific director said, pointing out that the country may struggle to meet electricity demand at all times unless it moves quickly to introduce incentives for backup capacity.

Read the interview here.

Energy storage association expects strong growth 'in every segment'

Photo: Smart Power GmbH

The storage systems industry in Germany expects its upward trend to firmly continue in 2026. However, policymakers still underestimate how much batteries and other storage solutions can contribute to supply security and flexibility to reduce costs, Beatrice Schulz from Germany's Battery Storage Systems Association (BVES) told Clean Energy Wire. She says the government must pull the right regulatory levers now so that the energy system can absorb the expected surge in storage capacity in the next years. 

Read the interview here

Germany’s climate action programme must focus on social dimension – researcher

Photo: CLEW

The government must put greater emphasis on making Germany’s move to climate neutrality socially fair as the country heads into a year with several important regional elections, said Brigitte Knopf, founder and director of think tank Zukunft KlimaSozial. Measures in the upcoming Climate Action Programme must consider people’s daily lives and tackle issues such as energy-efficient building renovations, the replacement of fossil fuel heating systems, and subsidies for electric car purchases based on income, she said. 

Read the interview here

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