How Germany Jumpstarted the Energy Transition

What the U.S. Can Learn from the Energiewende

The global transition to renewable energy requires bold policies, long-term vision, and strategic execution. One of the most ambitious and influential energy transitions in modern history is Germany’s Energiewende—a policy framework that has positioned the country as a global leader in renewables. But what can the U.S. learn from Germany’s approach? And how can these lessons be applied to accelerate clean energy adoption across the Atlantic?

The Origins of the Energiewende

Germany’s commitment to renewable energy didn’t emerge overnight. Beginning in the 1950s, energy policy was largely focused on domestic coal and later nuclear power. However, a growing environmental movement in the 1970s and 1980s, combined with public backlash against nuclear energy (especially after Chernobyl), led Germany to seek alternative energy solutions.

By the 1990s, Germany introduced policies that prioritized renewable energy, with the most significant being the Renewable Energy Act (EEG) in 2000, which introduced feed-in tariffs (FiTs)—a mechanism that guaranteed above-market prices for renewable energy, incentivizing investment and rapid deployment.

The Impact of Germany’s Renewable Policies

The results have been staggering. Since implementing FiTs and other policies:

• Renewable energy has grown from 3.1% of Germany’s electricity mix in 1990 to over 58% today.

• The country reduced CO2 emissions by 57 million tons.

• The renewable energy sector created over 280,000 jobs, with wind energy alone accounting for 60% of that workforce.

  
  

However, the success of FiTs came with challenges. As renewables became a larger share of the energy mix, electricity costs for consumers increased, leading to policy adjustments. In 2015, Germany began shifting away from FiTs toward an auction-based system to manage costs while maintaining its renewable energy targets.

While the U.S. and Germany have different political landscapes and energy markets, there are key lessons that could shape American energy policy:

1. Long-Term Policy Commitment Matters: Germany’s renewable energy expansion has been driven by consistent policy support across multiple administrations. In contrast, the U.S. has seen frequent policy reversals depending on political leadership. A long-term, bipartisan commitment to renewables is crucial for sustained growth.

   
   

2. Market Incentives Drive Investment: The FiT system provided certainty for investors, ensuring long-term returns. In the U.S., tax credits and state-level incentives have helped, but a national-level incentive structure—such as a modernized FiT or tax credit extensions—could drive faster adoption.

   
   

3. Energy Costs Must Be Managed: Germany’s experience shows that rapid renewable expansion needs a strategy to control electricity prices. In the U.S., mechanisms such as grid modernization, storage investments, and targeted subsidies could ensure affordability as renewables scale.

   
   

4. Public Support and Education Are Key: Germany’s energy transition was driven by strong public backing. In the U.S., greater emphasis on climate education, economic benefits, and job creation could help build bipartisan support for a national clean energy agenda.

   
   

A Blueprint for the Future

The U.S. has the resources, technology, and expertise to lead in clean energy. By learning from Germany’s successes and challenges, policymakers can develop a more resilient, cost-effective, and sustainable energy transition. The path forward isn’t about replicating Germany’s strategy wholesale—it’s about adapting the best elements to fit the unique needs of the U.S. energy market.

The Energiewende proves that ambitious policy can drive transformative change. The question is: Will the U.S. take the lead, or will it wait and follow?