On November 22, 2024, Robert Habeck, Germany's Minister of Economics from the Green Party, announced plans to introduce legislation aimed at funding new gas power plants before the federal elections scheduled for February 2025.

The proposed law is currently undergoing inter-ministerial review and is considered critical for facilitating the construction of new power plants necessary to meet electricity demand, especially when renewable sources are insufficient.

The new gas plants are part of a broader strategy to transition to more environmentally friendly hydrogen and to increase the share of renewable energy sources, with a goal of 80% of electricity coming from renewables by 2030.

The bill includes a proposed investment of approximately 17 billion euros from 2029 to 2045 for gas plants that can be converted to hydrogen and for long-term energy storage solutions, primarily funded through the Climate and Transformation Fund.

However, opposition from CDU's Jens Spahn poses challenges, as he advocates for a return to nuclear energy instead of negotiating on new gas power plants.

The urgency for this legislation is heightened by the upcoming elections on February 23, 2025, prompting the German Economic Ministry to act swiftly.

A cabinet decision on this legislation is expected by December 4, 2024, but the government faces challenges due to a lack of majority in the Bundestag, complicating its passage.

Delays in the legislation could jeopardize the timeline for phasing out coal, as new gas plants are intended to replace coal facilities set to close by 2030, particularly in Eastern Germany.

If the law is not passed before the elections, it could lead to significant delays, pushing back initial auctions for new plants beyond the first half of 2025 and affecting the planned operational start by 2030.

The transition to renewable energy necessitates the establishment of backup power plants to accommodate the intermittent nature of renewable sources.

The urgency of advancing this legislation reflects the government's commitment to meet its energy transition goals while addressing the immediate need for reliable power generation.