Solar and Wind Industries Warn German Reform Could Wipe Out Thousands of Jobs

Draft changes to Germany's Renewable Energy Act face backlash over job cuts, subsidy halts, and redispatch rules, threatening 10,000 jobs and investment freeze.

Berlin, July 25, 2026 — A draft reform of Germany’s Renewable Energy Act (EEG) is drawing fire from across the political and industrial spectrum, with warnings that the planned cuts could destroy 10,000 jobs. Greens lawmaker Michael Kellner leveled the accusation at Economy Minister Katherina Reiche (CDU) on Saturday, arguing that the fundamental flaws in her proposal remain unresolved. The draft, which includes a partial halt to subsidies for small solar installations and new restrictions on redispatch measures, has united critics from the solar, wind, and utility sectors.

Solar Sector Foresees Market Collapse

Industry voices had already sounded alarms days before the political clash. On July 23, 2026, the German Solar Industry Association (BSW-Solar) warned that the combination of the EEG overhaul and a planned grid package could trigger a severe downturn in photovoltaic expansion, putting tens of thousands of jobs at risk. The association’s sharpest criticism targets the planned elimination of EEG support for systems up to 25 kW and the mandatory direct marketing requirement for installations up to 100 kW.

A transitional payment of 5.2 cents per kilowatt-hour, proposed as a bridge, was dismissed by BSW-Solar as a “worthless band-aid.” Carsten Körnig, the association’s managing director, described the damage potential of the drafts as “alarmingly high.” Beyond the redispatch caveat, new contracts for difference (CfDs) and a 70 percent feed-in cap would further erode project viability. The housing industry also joined the protest, specifically criticizing the removal of feed-in tariffs.

Wind Energy Warns of Investment Freeze

Parallel concerns are emerging from the wind power sector. On the same day, the German Wind Energy Association (BWE) cautioned that the reform would effectively halt new installations. A central grievance is the redispatch rule change: once a plant’s share of curtailed power exceeds 5 percent, up to 20 percent of the curtailed electricity would go uncompensated. Additionally, from 2027 onward, a power density limit of 280 W/m² would apply. BWE analysis suggests this would affect 75 percent of already approved turbines.

BWE President Bärbel Heidebroeck accused the government of working against Germany’s industrial interests, arguing the drafts offer no investment security. A regional analysis for Lower Saxony puts threatened investments at 32 billion euros. The situation is paradoxical: while approvals for the first half of 2026 rose 14 percent to 9,150 MW, auctions reveal a bottleneck. Currently, 19,200 MW have been approved but have not secured a contract.

Procedural Gripes and Policy Paradox

The legislative process itself has drawn fire. The German Association of Energy and Water Industries (BDEW) complained on July 23 about an “extremely short” consultation period of just three working days. The VDMA engineering association also warned that the grid package would severely hamper wind expansion.

Revised drafts, released on July 23, softened some measures—compensation for grid bottlenecks was reduced rather than eliminated entirely. But the ministry is holding firm on subsidy cuts. The phase-out of support for small solar systems is to be cushioned by transitional payments running until 2029. Industry experts remain skeptical that these steps will be enough to keep Germany’s renewable energy expansion on track.