Germany Energy Industry LNG and Hydrogen
Market Overview & Challenges
Die Energiewende – Germany’s energy transition towards green energy – has been a key driver of the country’s energy policy, including the phase-out of nuclear power and continued investments in solar, wind, and biofuels.
In 2025, around 62 percent of Germany’s electricity is generated from renewable energy sources, with renewables consistently accounting for a larger share of electricity consumption than conventional fossil fuel-based power generation. However, Germany remains heavily dependent on fossil fuels, particularly in the heating and industrial sectors. Foreign suppliers account for around 95 percent of German natural gas consumption.
In 2020, 55 percent of Germany’s natural gas imports came from Russia, while around 40 percent of the remaining gas originated from Denmark, Norway, Belgium, and the Netherlands. In 2022, Germany’s new foreign policy and energy security strategy following Russia’s renewed invasion of Ukraine accelerated efforts to diversify its energy supply, and Germany ceased all imports of Russian natural gas.
In 2023, the United States exported an average of 7.1 billion cubic feet of LNG per day to EU countries, with an estimated value of more than USD 14.6 billion. These deliveries accounted for 48 percent of EU-wide LNG imports. By 2026, LNG has become an increasingly important component of Germany’s gas supply, supported by the expansion of import infrastructure and new LNG terminals in Wilhelmshaven, Brunsbüttel, and Rügen. LNG accounts for roughly 11 percent of Germany’s gas imports in early 2026, while Russian gas no longer appears in official pipeline import statistics. At the same time, LNG imports from the United States have risen sharply and now dominate throughput at German LNG terminals, underlining the growing strategic importance of transatlantic energy cooperation for Germany’s energy security.
Natural gas is the second-largest source of energy consumed in Germany, accounting for around 27 percent of primary energy consumption in 2025. It remains particularly important for industrial production and space heating.
Opportunities and Challenge—LNG and Hydrogen
Germany continues to diversify its energy supply and expand strategic energy partnerships to strengthen energy security and support the growth of renewable energy sources. Natural gas continues to play an important role, particularly in industry and heating. In recent years, Germany has significantly expanded its LNG infrastructure, including both floating and onshore terminals in Wilhelmshaven, Brunsbüttel, and Rügen.
- To continue attracting U.S. energy supplies, the German government has signed long-term contracts, typically ranging from 15 to 20 years, with American natural gas companies.
- With large-scale maritime LNG deliveries, the following downstream segments are expected to attract additional investment: bunker supply, LNG depots, storage, off‑grid applications, and LNG fuels.
- Germany continues to support the development of the Hanseatic Energy Hub in Stade as part of its long-term LNG diversification strategy. The project is designed as a future-ready import terminal for LNG and low‑carbon gases, including hydrogen‑based energy carriers. While earlier plans envisaged operations beginning in 2026, the land-based terminal is now expected to come onstream in 2029.
Public and political debates continue regarding the economic and environmental costs associated with LNG imports, including infrastructure investments, transportation costs, and emissions linked to LNG production and shipping.
Hydrogen is expected to play an important role in Germany’s long-term decarbonization strategy, particularly in hard‑to‑abate industrial sectors such as steel, chemicals, and heavy transport. However, the sector still faces major challenges related to infrastructure expansion, high production costs, and the scaling of transport and storage capacities. The German government continues to support the development of domestic clean hydrogen production while simultaneously pursuing international supply partnerships for hydrogen and hydrogen-based energy carriers such as ammonia. Due to limited domestic production potential, Germany is expected to rely heavily on imports to meet future hydrogen demand. At the same time, concerns remain about economic viability without substantial public subsidies and long-term policy support.
Germany has significantly expanded public investment in hydrogen infrastructure and industrial decarbonization as part of its long-term energy transition strategy. Current federal funding commitments for hydrogen-related projects amount to several billion euros and include support for research and development, electrolyzer capacity, import infrastructure, storage solutions, and the conversion of industrial processes toward hydrogen-based technologies. In addition, the federal government continues to provide substantial financial support for the transition of gas-fired power plants toward hydrogen‑ready technologies.
Germany views its extensive underground cavern infrastructure as a key strategic advantage for future large-scale hydrogen storage. According to the National Hydrogen Council, hydrogen storage demand is expected to rise significantly between 2030 and 2050. However, Germany’s hydrogen ambitions are facing significant headwinds. High production costs, insufficient infrastructure, and economic uncertainty have prompted several major industrial players to pause or cancel projects.
Relevant Trade Shows
Hydrogen Technology Expo
E-World of Energy & Water
The Smarter E-Europe