Germany's plans for energy and infrastructure 

Takeaways from the new coalition agreement

Germany’s new government (a coalition of the conservative CDU/CSU and Social Democrats SPD) has presented an ambitious roadmap to modernise the country’s infrastructure – by increasing government spending, mobilising private capital, cutting back on red tape and streamlining planning processes. 

This blog summarises key takeaways for the infrastructure and energy sector from the new government's coalition agreement (Koalitionsvertrag – German version only) as it was published on 9 April 2025. The coalition agreement is a policy roadmap of what the new government wants to achieve in the next four years. It still requires specific legislative and executive actions to implement these policies. However, it is a guideline to understand the new government's priorities and to spot market opportunities. 

Infrastructure investments

• Germany Fund: the so called "Deutschlandfonds" to be established aims for a minimum volume of EUR 100 billion (anticipated spending in the region of EUR 500 billion). EUR 10 billion in public money will be contributed by the federal government by way of guarantees and financial transactions; the rest is expected to be contributed by private capital. Funds will be used to close financial gaps in growth and innovation capital for SMEs and scale-ups.
• Energy Infrastructure Fund: Germany will establish an investment fund for energy infrastructure providing access to equity and loans.
  
• Special Fund for Infrastructure and Climate Neutrality: Germany's special fund for infrastructure (Sondervermögen Infrastruktur und Klimaneutralität), which recently required an amendment of Germany's constitutional debt brake, will be implemented. The states and municipalities will receive EUR 100 billion, another EUR 100 billion will be allocated to the (already existing) Climate and Transformation Funds (Klima- und Transformationsfonds). Federal infrastructure spending between 2025 and 2029 will be approx. EUR 150 billion.
• Reduced equity requirements: Germany commits to work towards reforming Solvency II requirements on the EU level to reduce equity requirements for infrastructure investments.
• Autobahn GmbH: The government owned entity in charge of planning, constructing and administering Germany's highways will be allowed to access loans as source of financing, a portion of the revenues from Germany's highway toll system (for commercial vehicles) will be allocated to Autobahn GmbH as a source of income.
• State owned entities: The federal government holds shares in various companies. Existing investments will be reviewed and potentially reduced to a "strategic share" only. At the same time state participation in the energy and defence sector will be considered.

Mobility & Transport

• EV charging: Accelerated expansion of the ev charging network in Germany based on secured financing. E-mobility, in general supported by further tax incentives and subsidies, no fixed quotas.
• Hydrogen charging: In addition, Germany wants to promote a hydrogen charging infrastructure for commercial vehicles.
• National ports strategy: Proper implementation of Germany's national ports strategy published in March 2024, securing of adequate additional financing for the expansion of waterways, locks, sea and inland ports.
• Shipyards: Supporting German shipyards in transitioning to constructing offshore converter platforms, e.g. through guarantees.
• Public transport: Will continue to rely on public funding as well as ticket sales for financing, but private capital, including PPP, should be a third pillar. The existing legal framework will be updated to ensure better financing going forward.
• Rail: Germany's Infraplan, a 5-year work program for DB InfraGO, Germany's state owned company in charge of its railway tracks, will be backed financially by a new railway infrastructure fund (Eisenbahninfrastrukturfonds). A more comprehensive reform of the rail sector is also intended, in particular by further unbundling DB InfraGO within Deutsche Bahn group.

Energy

• Energy prices: Energy prices will be reduced permanently by 5 cents/kWh through various means: A reduction of Germany's electricity tax to the EU minimum, a permanent extension of electricity price compensation mechanisms, a potential cap on grid fees, and the inclusion of data centres in existing subsidy schemes. The gas storage levy will be abolished.
  
• Industrial Electricity Price: Germany also considers introducing a (lower) industrial electricity price (Industriestrompreis) for energy intensive companies requiring additional support.
  
• Smart meters: The rollout of smart meters and dynamic electricity tariffs will be further accelerated.
  
• Renewables: Germany remains committed to further supporting and expanding energy generation from renewables. However, renewables should eventually be able to fully refinance themselves on the market (i.e., fewer subsidies). Solar: Strengthening of dual use (agri-PV, floating-PV, parking-PV). Onshore wind: Land lease fees will be capped if the wind farm receives subsidies. Offshore wind: enabling hybrid connections (cable and H2 pipeline). Geothermal energy: New legislation to accelerate the use of geothermal energy is planned.
  
• BESS: Energy storage systems will be classified as being of ‘overriding public interest’ for the purposes of planning and approval procedures, which makes permitting easier. Further expansion of BESS capacity should also be achieved by making use of the market.
  
• Security of power supply: As part of the (existing) "power plant strategy" (Kraftwerkstrategie) Germany intends to conduct technology neutral tenders to incentivise up to 20 GW of additional gas-fired power plant capacity by 2030. Existing reserve power plants should not only be used to compensate energy supply bottlenecks but also to flatten cost peaks in energy generation.
  
• Hydrogen: The further ramp-up of hydrogen (governed by Germany's hydrogen strategy) both in production and import will be further supported, including the construction and expansion of necessary infrastructure, such as the hydrogen core network. During the ramp-up phase, all colours of hydrogen should be considered.
  
• Coal: The coal phase-out remains in place until 2038.
  
• Nuclear: Not mentioned at all. This likely means that Germany continues to stand by its previous decision to end nuclear energy production.

Please reach out to our German energy and infrastructure team if you want to discuss any of the above further.

For more global insights on energy and infrastructure, please also check out: Our Energy Predictions for 2025; Data Centres – A modern digital asset class and Powering Change: A New Era for the Energy Transition