German Energiewende and the death of merchant baseload (2011-2022)
After the Fukushima accident, Germany committed to phase out nuclear and accelerated renewable buildout under the Energiewende. Wholesale prices crashed at midday. Coal and gas plants designed to run flat were forced to cycle daily, then to close.
Major utilities RWE and E.ON took multi-billion-euro writedowns on conventional plants. Several hard-coal stations retired earlier than planned.
Germany rebuilt its market design around capacity mechanisms and flexibility payments. The country now imports power from France during low-renewable periods and exports during sunny windows.
Germany shows the financial path that follows the operational shift. Once a fleet starts running bent, the merchant economics change. Without new market design, plant owners either lose money or close units. France will face the same question for nuclear.
