Posted originally on CTH on January 16, 2026 | Sundance |

Germany has a severe electricity shortage and cost problem, and it’s getting worse.

German Chancellor Friedrich Merz recently made the admission that shutting down the German nuclear power reactors was a “severe strategic mistake.”

“To have acceptable market prices for energy production again, we would have to permanently subsidize energy prices from the federal budget,” Merz said, adding: “We can’t do this in the long run.”

“So, we are now undertaking the most expensive energy transition in the entire world,” Merz said with pronounced frustration. “I know of no other country that makes things so expensive and difficult as Germany.”

Keep in mind, Germany represents the largest contributing economy in the European Union.  The German industrial sector is the backbone of the European economic model.

All of these realities paint a very tenuous picture for the economic future in Europe, when combined with a new trade relationship with the USA, increasingly cheap goods dumped into the EU by China and the EU promising to continue spending on the war effort in Ukraine against Russia.