Energy Market Experts Forecast Medium-Term Risks for Energy Providers as a Result of the Energy Transition

The turnaround in German energy policy, the energy transition (“Energiewende”), is considered one of the major energy policy projects in German history. Such an ambitious project will bring about notable changes in many areas of the German business landscape. Over the medium term, the energy transition will have a significant impact on the economic situation of companies in the energy sector, as well as on companies involved in the construction of power plants. The resulting opportunities and risks, however, are unevenly distributed. This is a finding from the current Energy Market Barometer carried out by the Mannheim Centre for European Economic Research (ZEW). More than 200 energy market experts participated in the survey. They were asked to assess the consequences of the energy transition on the economic situation of companies in the energy sector and on the German economy as a whole on a five-year horizon.

According to 71 per cent of the experts surveyed, the economic situation of energy providers will deteriorate as a result of the energy transition. Power plant construction companies are considered to be facing poor prospects by 51 per cent of experts. Only 17 per cent of experts expect to see an improvement in the economic situation of companies in this sector, while 24 per cent believe it will remain unchanged.

Experts assume that the energy transition will impact electricity grid operators to a rather small extent, with 58 per cent forecasting a stable economic situation. Positive (22 per cent) and negative assessments (20 per cent) are balanced.

The majority of experts do not expect the energy transition to bring about changes in the electricity retailer companies’ economic situation. Just 29 per cent of experts forecast a negative impact, while 13 per cent expect a positive trend.

Around 41 per cent of experts estimate that the energy transition will have a positive or very positive impact on the German national economy and expect new opportunities opening up as a result. Slightly over 32 per cent fear negative or very negative consequences.

The ZEW Energy Market Barometer

The ZEW Energy Market Barometer is a biannual survey conducted among some 200 experts from academia and the energy industry (including energy supply, trading, and service companies). Participants are surveyed in regard to their expectations concerning short- (six-month horizon) and medium-term (five-year horizon) developments in national and international energy markets. The results from the latest survey, carried out in May 2015, are available in the current ZEW Energiemarktbarometer (Energy Market Barometer) (in German only).

For more information please contact

Philipp Massier, Phone +49(0)621/1235-332, E-mail massier@zew.de