GERMANY Trends and Developments Contributed by: Gregor von Bonin, Natascha Doll, Andreas Ruthemeyer, Stefan Schröder and Mirko Masek, Freshfields
Executive Summary Germany’s energy and infrastructure M&A market remains one of Europe’s most active and sophisti- cated. Despite macroeconomic headwinds, the com- bination of strong policy support, a deep industrial base and an established legal framework continues to attract both strategic and financial investors. The country added around 20 GW of renewable capac- ity in 2024, bringing total installed capacity close to 190 GW. This is a record level driven by solar PV but complemented by steady onshore wind growth and new offshore auctions. That acceleration underpins a continuous secondary market in operating portfo- lios, platform acquisitions and late-stage development projects. Furthermore, expanding the transport capacity, par- ticularly for electricity transmission grids, is essential to meet increasing demand, requiring billions of euros in investment. Aspects of energy security on the one hand and industrial competitiveness on the other hand have emerged as dual policy priorities. As coal is phased out and Russian gas imports cease, the focus has shifted towards resilient LNG import facilities. At the same time, there is a pressing need for baseload gas- fired power plants. Ideally, both LNG import terminals and power plants will be constructed hydrogen-ready. Tenders for approximately 12 GW of gas power plants are expected in the short term, accompanied by the introduction of a capacity mechanism designed to ensure system adequacy. These measures will create new investment classes at the intersection of public support and private capital. Beyond electricity generation, the German market is entering a second stage of the energy transition focused on infrastructure integration. The build-out of the Hydrogen Core Network (H₂-Kernnetz) and the first Carbon-Management Law provide the legal foun- dations for the transport and storage of hydrogen and CO₂, transforming decarbonisation from policy ambi- tion to industrial practice. Meanwhile, the convergence of heat, mobility and digital infrastructure is reshaping energy investment.
Municipal heat planning, EV charging network expan- sion and data centre efficiency regulation are merging traditional energy law with infrastructure and technol- ogy. While fiscal tightening following the Constitutional Court’s 2023 ruling on the Climate and Transformation Fund has temporarily slowed some subsidy schemes, the implementation of the EUR500 billion infrastruc- ture special budget (ISB) in early 2025 made headlines around the world. While the ISB is widely perceived as a foundational step towards a transformative era, with many exciting opportunities for investors, the details and long-term impact of the ISB have largely remained undefined. In the following sections, we provide an overview of the German energy and infrastructure M&A market and then drill down into key segments – from renew- able energy generation to digital infrastructure. We highlight the main trends, regulatory developments, and practical considerations for each, focusing on what international investors and companies need to know when doing business in Germany’s evolving landscape. Overview of the Energy and Infrastructure M&A Market in Germany The German energy and infrastructure M&A market is characterised by strong, policy-driven structural growth, stemming from a national commitment to decarbonisation and digital transformation. We expect to see sustained activity, with strategic portfolio repo- sitioning and the pursuit of green, cash-generative assets defining the transactional landscape. Key Drivers of M&A Activity • Infrastructure Renewal and Development: Decades of under-investment into core infrastructure are giv- ing way to accelerated expansion. The grid opera- tors’ ten-year plans alone require over EUR250 billion by 2035. The same is true in relation to the realisation of hydrogen infrastructure, first of all with respect to the realisation of projects that shall be part of the planned Hydrogen Core Grid. Transmission system operators (TSOs), distribution system operators (DSOs) and designated hydrogen
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