Germany Introduces its First Capacity Market The StromVKG: An Overview

23 July 2026

Germany has reached a major milestone in the reform of its electricity market. The German Parliament (Bundestag) has adopted the Electricity Supply Security and Capacity Act (Strom-Versorgungssicherheits-und-Kapazitätengesetz, "StromVKG"), introducing Germany's first comprehensive statutory capacity market.

The Act entered into force on 22 July 2026, following its publication in the Federal Gazette. Although formal state aid approval by the European Commission remains outstanding, such approval is generally expected without significant obstacles, given that the StromVKG is based on the political agreement reached between the Federal Government and the European Commission earlier this year.

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