Germany: Development of KfW Funding for Renewable Energy – New Funding Product “Renewable Energy Plus” Announced

KfW is adapting its funding offerings in the field of renewable energy and expanding the existing product family with a new financing instrument. From June 18, 2026, an additional program will be available with “Renewable Energy Plus (570)”, which will complement the existing standard offering.

The target of this development is to support investments in renewable energy even more specifically and to further strengthen the expansion of market-based business models.

Addressees

The new funding program is aimed at a broad market environment. Eligible to apply for projects in Germany are natural persons, legal entities, and partnerships, provided they are engaged in commercial or professional activities or intend to take up such activities. This applies to both companies based in Germany and abroad. For projects in the EU as well as Norway and the United Kingdom, companies based in Germany, subsidiaries of German companies, and joint ventures with their own legal personality and at least 25% German participation are eligible to apply. Companies of all sizes are funded.

Not eligible to apply are the federal government, the federal states and their institutions, as well as municipalities, municipal territorial authorities, and municipal non-independent operations.

Which projects are funded?

The focus remains on financing projects related to the energy transition. These include in particular:

• Use of renewable energy for electricity or heat generation
• Projects in the field of combined heat and power (CHP plants)
• Investments in storage solutions for renewable energy

Eligible for funding are investments in the construction and acquisition of eligible plants as well as modernizations of existing or used plants. These include photovoltaic systems, onshore/offshore wind turbines, hydroelectric plants, electric heat pumps, solar thermal systems, geothermal plants including CHP plants, electricity storage (including closed-loop pumped storage plants), heat storage, or hydrogen storage (including conversion of existing underground gas storage facilities).

A particular focus is on the market-based expansion of renewable energy and the marketing of electricity, especially through direct supply contracts (Power Purchase Agreements).

Contracting projects are eligible for funding provided that the contracting provider meets the eligibility requirements, bears the economic risk, and is the investor and operator of the plant.

Investments in fossil-fueled electricity or heat generation plants as well as in directly related facilities, such as storage, are not financed.

The new program “Renewable Energy Plus” complements the existing funding program “Renewable Energy – Standard (270)”. In the future, two closely related but differently structured financing options will be available. While the “Renewable Energy – Standard” program is designed to be subsidy-free and can therefore often be combined more flexibly with other public funding – such as state programs – the respective state aid regulations and cumulation limits must be observed for “Renewable Energy Plus”. However, the prerequisite always remains that the other funding programs also allow such a combination.

For the market, this primarily means a finer gradation of financing instruments and more scope for more complex project structures.

Funding Conditions and Application

The loan amounts to a maximum of €150 million per project and finances up to 100% of eligible costs, whereby the loan ceiling can be exceeded in justified cases.

The term is between 2 and 20 years depending on the variant and includes one to a maximum of three principal-free years as well as an interest rate lock for the entire loan term or at least the first 10 years. The interest rate is set at market rates on the day of approval and depends on creditworthiness and collateral.

Disbursement is made at 100% of the approved amount and can be called in a lump sum or in partial amounts within 12 months (extendable by up to 24 months). For loan amounts not yet called, a commitment fee is charged – starting six months after the approval date.

During the principal-free period, only interest is paid; thereafter, repayment is made quarterly in equal installments. Early repayments are generally only possible against a prepayment penalty.

The application is made according to the house bank principle: KfW grants loans from this program through financing partners such as banks and savings banks. The application must therefore be submitted to a financing partner of the applicant’s choice before the start of the project.

Cumulability

In principle, the combination of funding from this program with other funding (loans or allowances/grants) is possible within the permissible state aid ceilings.

Funding is excluded if funding under the EEG, the Federal Funding for Efficient Heat Networks (BEW), the KWKG, or comparable state funding (e.g., feed-in tariff) is already being claimed for the eligible plants. In these cases, funding can instead be applied for via the product “Renewable Energy – Standard” (270).

Development within the Framework of the Germany Fund

Parallel to the introduction of the new Renewable Energy program, KfW is working on behalf of the federal government on further financing instruments to strengthen energy infrastructure.

The funding programs “Investment Loan Energy Supply” with liability exemption and “KfW Syndicated Loan Energy Supply” are primarily aimed at regional energy suppliers and specifically promote investments in electricity distribution and heat supply. The funding program “Renewable Energy Plus with Liability Exemption” is intended to support the market-based expansion of renewable energy.

These programs are intended to create additional financing scope and facilitate larger infrastructure projects in particular. The introduction of the programs is planned for mid to late 2026, but is still subject to the approval of the federal government.

Interested? Feel free to contact us.

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