Key facts
- Gas-fired projects won all 5.16 GW of derated capacity in Germany's first capacity auction, per Rystad Energy.
- RWE and LEAG took more than 99% of awarded capacity, with over half at existing coal sites.
- Almost 12 GW of bids competed for a 4.5 GW procurement target, Rystad Energy said.
- The volume-weighted average award price was about €155,000 per derated MW per year, 36% below the ceiling, per Rystad.
- Projects had to deliver at least 80% of installed capacity for 10 consecutive hours, a rule Rystad said favored gas.
Germany's first capacity auction awarded all 5.16 gigawatts of derated capacity to gas-fired power projects, with RWE and LEAG winning more than 99% of the contracts, according to a column by energy consultancy Rystad Energy published by Oilprice.com on November 11, 2026.
More than half of the awarded capacity went to developments at existing coal plant sites. LEAG's awards at its lignite sites reflect the value of reusing grid connections and other infrastructure, Rystad said, noting that an established power plant site can cut investment costs and development timelines. Derated capacity is adjusted to reflect each project's expected contribution to security of supply.
Germany is adding gas-fired plants to back up wind and solar output during prolonged periods of low renewable generation, known as Dunkelflaute. Capacity payments reward operators for keeping that supply available as coal generation is phased out.
The first round required projects to deliver at least 80% of installed capacity for 10 consecutive hours. Rystad said that requirement favored gas generation and made it hard for batteries to compete economically, leaving battery storage projects without awards.
Almost 12 gigawatts of bids competed for a 4.5 gigawatt procurement target. Rystad put the volume-weighted average award price at about €155,000 per derated megawatt per year, 36% below the auction's price ceiling but above recent European capacity auction benchmarks. Germany is procuring new long-duration capacity with hydrogen-readiness requirements, which Rystad said limits direct comparisons with markets that also support existing assets.
Later auctions could suit batteries and other flexibility sources better, depending on duration requirements and contract terms, Rystad said. The winning gas plants offer a potential future market for hydrogen suppliers, but Rystad said readiness to switch fuel does not guarantee hydrogen consumption.