Electricity Supply Security and Capacity Act (StromVKG) Clears the Way for New Hydrogen-ready Power Plants

With the Electricity Supply Security and Capacity Act (StromVKG), the German Bundestag is setting the course for a new fleet of hydrogen-ready power plants in Germany. Dr. Timm Kehler, CEO of the association “Die Gas- und Wasserstoffwirtschaft,” sees the adoption of the law before the summer recess as an important signal for security of supply, the coal phase-out, and the ramp-up of dispatchable generation capacity.

“Hydrogen-ready gas-fired power plants are a prerequisite for a secure energy transition. They generate electricity when wind and solar are insufficient, provide backup during periods of low renewable output and peak demand, and at the same time create the asset base for future operation with hydrogen. The Bundestag’s decision to pass the StromVKG before the summer recess therefore sends an important signal: the first tenders can start as planned in September, so that the new capacities are available by 2031 and the coal phase-out is reliably secured.

Important adjustments were made during the parliamentary process. In particular, the more realistic design of key tender parameters improves the chances that the law will translate into concrete investments. It remains crucial that the tenders trigger sufficient competition and that projects can be financed, permitted, and built under realistic conditions.

With the law in place, the real work begins. New power plants require not only contract awards but also available sites, fast permitting procedures, secured gas grid connections, and, in the long term, hydrogen connections. Fuel supply and storage infrastructure must also be considered in a timely manner. Only if the power plant strategy aligns with gas and hydrogen infrastructure can the StromVKG make its contribution to security of supply.”