On July 9 and 10, 2026, the Bundestag and Bundesrat approved the addition of eleven gigawatts of new dispatchable power generation capacity to the reserve in Berlin. This decision is based on the Electricity Supply Security and Capacity Act (StromVKG). A multi-billion-euro levy targeting gas-fired power plants is intended to fund payments to successful operators starting in 2031; additional fuel and operating costs will be incurred once the plants actually generate electricity. The move is driven by the coal phase-out and the risk of supply gaps during prolonged periods of low wind and solar output (known as Dunkelflaute). According to official calculations, a significant amount of firm capacity will be missing by 2035 without these new facilities. However, the EU Commission has yet to approve the subsidy scheme. Consequently, electricity consumers face the prospect of long-term additional costs, the exact level of which will be determined by the auctions.
New power plants to provide backup during periods of low wind and solar output
Initially, nine gigawatts of so-called long-duration capacity are to be developed. Auctions for this purpose are scheduled for September 8 and December 29, 2026. Each facility must be capable of delivering 80 percent of its installed capacity for ten hours. Furthermore, operators are required to keep the committed capacity available for 15 years.
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Another tender for two gigawatts is scheduled for May 2027; battery storage systems and other technologies will also be eligible to participate. At least one-third of the new capacity is to be located in the north of the grid area, while the remaining capacity will be concentrated primarily in the south. However, the Federal Network Agency may only award contracts following approval from Brussels.
Multi-billion euro levy for gas-fired power plants could reach €2.68 billion
The potential multi-billion euro levy for gas-fired power plants depends on the successful bids. The statutory maximum price is €244,000 per megawatt per year. Based on this figure, the maximum annual cost for nine gigawatts would be €2.196 billion. For the full eleven gigawatts, the theoretical upper limit rises to €2.684 billion. In reality, however, successful bids could be significantly lower.
The payments primarily compensate for the binding provision of capacity. Consequently, operators receive payment even if their plants rarely generate electricity. Fuel and operating costs are incurred separately whenever the power plants actually step in to generate power. Therefore, the levy for gas-fired power plants does not automatically lower wholesale electricity prices; its primary purpose is to pay for security against prolonged gaps in electricity supply.
Demand could continue to rise through 2035
The demand for dispatchable capacity could continue to grow after 2031. The Federal Network Agency cites a gross capacity addition of 22.4 gigawatts by 2035 in its target scenario. However, if the energy transition is delayed, this figure rises to as much as 35.5 gigawatts. This figure does not account for plant decommissioning, so a linear cost projection is not possible; nevertheless, further power plant auctions could increase annual costs.
Policymakers are also banking on hydrogen-ready gas power plants. Fraunhofer estimates the procurement costs for grid-connected hydrogen power plants in 2035 at between 8.77 and 15.16 euros per kilogram. This equates to 265 to 460 euros per megawatt-hour of fuel energy. Transport and storage account for around half of this amount. Consequently, both future fuel costs and capacity payments remain uncertain.
Author: Blackout News
Sources: Der Sandwirt (15.07.26) – BDEW (13.07.26) – Die Bundesregierung (21.07.26) – Deutscher Bundestag (09.07.26) – Die Zeit (09.07.26)