Almost four years ago, Germany learned a painful lesson: your industry cannot depend on the energy of a geopolitical rival. The Russian gas crisis after the invasion of Ukraine forced the Germans to make more than one sacrifice while the country’s energy model was transformed. Now, at the gates of 2026, Friedrich Merz’s government faces a déjà vu disturbing.
The same stone twice. Germany may have become independent of Gazprom’s gas pipelines, but its solar panels and grid technology bear, directly or indirectly, China’s stamp. Good: Berlin has just hit the brakes. The collapse of a seemingly innocuous financial operation last week has revealed that Germany is carefully reviewing every watt that enters its system to avoid repeating the historic Russian gas mistake.
The trigger. The Italian company Snam SpA intended to acquire a minority stake in Open Grid Europe (OGE), one of the largest gas network operators in Germany. On paper, it was an investment between European partners. In practice, the German Economy Ministry saw the shadow of Beijing. The problem was not Snam, but its shareholders.
The state-owned State Grid Corporation of China owns 35% of Cassa Depositi e Prestiti, which in turn owns a third of Snam. For the Merz government, that was risk enough. Given Berlin’s refusal to accept the proposed solutions, Snam withdrew its offer last week.
A clear message. Berlin does not want companies with Chinese state participation to have access to the country’s energy arteries, even indirectly, which marks a change in doctrine compared to the era of Olaf Scholz, who at the time allowed the Chinese shipping company Cosco to enter the port of Hamburg. The current executive is much more defensive: national security takes precedence over capital. The question is…
Too late? If blocking the purchase of a gas network is relatively simple, unraveling technological dependence on China is a logistical and economic nightmare. 95% of the photovoltaic cells installed in Germany come from Chinese manufacturers. And almost the entire wind industry, especially offshore, depends on rare earths controlled by China.
The German energy transition is based on Asian hardware. Germany needs Chinese technology to meet its climate goals. And he doesn’t hide it. The German government has already raised this concern in international forums, denouncing the Chinese overcapacity in sectors such as electric mobility and solar energy. Technology that is needed but now considered a “systemic risk.”
Is decoupling possible? In 2018, the German government already had to intervene so that the state bank KfW bought a stake in the network operator 50Hertz, preventing it from falling into the hands, again, of the Chinese State Grid. Seven years later, the strategy of “patching” individual acquisitions seems insufficient in the face of structural dependence.
If the experience with Russia is any guide, Berlin seems to have decided that, this time, the price of security must be paid in advance, before anyone decides to turn off the tap. But today, the reality of the market is stubborn: replacing Chinese hardware means, almost invariably, paying more and taking longer to deploy renewables.
Image | rawpixel
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