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Germany’s Power Shift Deepens as Solar Surpasses Coal and Grid Expansion Accelerates

Government-backed grid expansion seeks to relieve bottlenecks and cut power bills in 2026.

Overview

  • Fraunhofer ISE reports photovoltaic output around 87 TWh in 2025, topping coal for the first time as coal’s share fell to about 22.4 percent and wind remained the largest source.
  • Regulators approved roughly 2,000 kilometers of new high-capacity lines in 2025 and finalized procedures for A‑Nord, Ultranet, SuedLink and SuedOstLink, with first operations slated for late 2026 to 2027.
  • Bayernwerk unveiled a distribution-grid plan through 2030 for about 40,000 kilometers of medium‑ and low‑voltage lines, roughly 1,000 kilometers of high‑voltage upgrades, around 300 substation modernizations and digital controls.
  • The utility says it has received connection requests for about 77,000 MW of storage, highlighting the push for flexibility as hours with negative wholesale prices hit a new record and costs tied to support schemes draw criticism.
  • Berlin is granting about €6.5 billion to transmission operators to lower network fees and launching a subsidized industrial power price from January 1, 2026, while RWE’s CEO expects household electricity to be cheaper this year and critics question the industry aid’s design.