Germany is advancing in its energy transition, but obstacles remain.

Germany is advancing its energy transition, with renewable energy comprising 55% of gross electricity consumption in 2024. However, achieving climate neutrality presents significant challenges, as noted in a report by the German Association of Energy and Water Industries (BDEW) and consultancy EY.

The Energy Transition Progress Monitor 2025 highlights progress in renewable energy expansion and emissions reduction, but the new federal government faces pressure to take decisive action for the energy transition's success.

Kerstin Andreae, chair of the BDEW executive board, emphasized that while important milestones have been reached, many areas must accelerate to meet the 2045 climate neutrality goal.

Strategic priorities include speeding up the planning and approval of renewable projects, ensuring they align with grid infrastructure development, and maintaining energy security through new dispatchable power plants, increased digitalization, and rapid hydrogen infrastructure rollout.

A sustainable electricity market must be created to provide clear market-based incentives for flexible energy generation and consumption. Advancing the heat transition and expanding electromobility are also crucial, requiring regulatory consistency and practical implementation.

Support for the hydrogen economy is essential through dependable regulations and targeted funding to foster its development within the wider energy system.

In 2024, renewable energy made up 57.7% of total electricity generation, an increase of 3.5 percentage points from 2023 and a rise of 40.9 points since 2010. This growth is partly attributed to a decrease in total electricity generation.

Solar power was the main driver of renewable expansion in 2024, with new capacity reaching 17 GW, exceeding last year's 15.4 GW. In contrast, wind energy development was slow, with 3.3 GW of new onshore capacity and only about 700 MW added offshore, well below the target.

On a positive note, current permitting figures and high interest in onshore wind auctions are encouraging.

Home storage batteries accounted for the majority of installed battery capacity in Germany, totaling 9.2 GW. The report noted record demand of 226 GW in connection capacity from transmission system operators, although the feasibility of many projects remains uncertain due to their early development stage.

The study also cautioned that the hydrogen economy's growth is lagging, with only 1.6 GW of the targeted 10 GW of electrolysis capacity secured by 2030.