Europe’s Clean-Tech Pivot: Germany Leads Supply Chain Shift Amid €390B Investment Surge

Germany is cutting its dependence on Chinese wind turbine components by 2035, launching a major strategy to diversify its offshore wind supply chain. As Europe ramps up clean tech investments, this move marks a shift toward energy security and regional manufacturing resilience.

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German offshore wind

Germany has announced a landmark strategy to break its near-total dependence on Chinese-made components for offshore wind turbines, particularly the permanent magnets essential to the industry. This move, unveiled by the Economy Ministry, forms part of a broader plan to build a more resilient and geopolitically secure renewable energy infrastructure. The Resilience Roadmap aims for 30 percent of permanent magnet supply to come from alternative sources by 2030, increasing to 50 percent by 2035. China currently supplies about 90 percent of these components globally, mostly through its dominance in the rare earth metals market.

To meet its ambitious climate and energy goals, Germany is targeting an offshore wind capacity of 30 gigawatts by 2030—triple its current levels. Offshore wind already contributes around 5 percent of Germany’s electricity supply, and the government hopes renewables will account for 80 percent of national electricity production by the end of the decade. The shift away from China is not merely about energy diversification; it represents a strategic reshoring of the energy transition and a rejection of supply chains vulnerable to geopolitical risk.

This German announcement fits into a broader European trend. Across the continent, governments are accelerating investment in clean technology, aiming to secure domestic manufacturing capacity and reduce exposure to international bottlenecks. The global cleantech market, valued at approximately $916 billion in 2024, is projected to double to $1.84 trillion by 2030, with an annual growth rate of nearly 13 percent. In the European Union alone, clean energy investments are expected to reach nearly $390 billion in 2025.

Venture capital trends in the EU’s cleantech sector reflect the momentum. After a slow start to the year, venture funding rebounded in the second quarter of 2025, reaching €2.5 billion—the strongest quarterly performance since early 2024. The average deal size has also grown, reflecting increasing investor confidence in scale-up technologies and manufacturing. While early-stage funding remains cautious, the appetite for industrial decarbonization and infrastructure-linked technologies is clearly rising.

Policymakers are backing this momentum with sweeping industrial legislation. Under the EU’s Net-Zero Industry Act, passed in June 2024, the bloc aims to produce at least 40 percent of its annual net-zero technology needs domestically by 2030. The act also sets a target for Europe to produce 15 percent of the world’s clean-tech equipment by 2040. However, this ambition comes in response to a stark reality: Europe’s share of global wind turbine manufacturing fell from 58 percent in 2017 to just 30 percent in 2022. Solar panel manufacturing remains even more concentrated outside the continent, despite EU efforts to reshore production.

In terms of deployment, Europe is making strong progress. In 2024, renewables supplied nearly half of the EU’s electricity, with wind and solar leading the charge. Solar photovoltaic capacity alone reached around 269 gigawatts by the end of 2023, and the EU is targeting 600 gigawatts by 2030. The Clean Industrial Deal, launched earlier this year, promises to push 100 gigawatts of new renewable energy capacity annually through 2030, while also funding green innovation and supporting the transition of energy-intensive industries.

Germany’s strategy to secure its wind industry against supply shocks highlights a key shift in clean-tech policy. While markets once favored the cheapest global supplier—often China—the future is likely to reward regional resilience, strategic partnerships, and closed-loop value chains. Germany is already in talks with Japan and Australia to source rare earths more sustainably and with less environmental and political risk.

As the EU mobilizes hundreds of billions of euros to decarbonize its economy, challenges remain. Permitting delays, rising material costs, and global competition for critical minerals could still slow the pace of change. Yet Germany’s move to de-risk its offshore wind supply chain is an unmistakable signal: in the energy transition, security and sustainability must go hand in hand.

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