Fifty-two-year-old Katharina Reich is seen by many as a belligerent figure, making her a controversial figure in Germany. This was her image even before she unexpectedly became Minister of Economic Affairs in the government of Chancellor Friedrich Merz in 2025. Environmentalists and climate activists have long regarded the conservative Christian Democratic Union (CDU) politician as pro-business and pro-industry and an opponent of an ambitious shift toward renewable energy.
After serving in the Bundestag from 1998 to 2015, the politician from Luckenwalde, Brandenburg, 80 kilometers south of Berlin, moved into the energy industry. Some critics referred to him as a lobbyist.
Among other roles, Reich served as chairman of the executive board of WestEnergy, a subsidiary of energy giant E.ON. Is the largest subsidiary of. With approximately 10,000 employees, WestEnergy supplies significant amounts of fossil fuel energy to approximately 6.6 million people.
Withdrawal of Habré’s policies
Soon after taking office, Reich made it clear that he intended to reverse the efforts of his predecessor, environmentalist Robert Habach of the Green Party, to pursue an energy transition in German home heating systems. About 72% of German homes are heated with natural gas or oil. Along with transportation, the building construction sector is considered to be the sector in which the country has made the least progress in implementing its climate policy. Both sectors have been missing targets for years.
Habek wanted to change this and drafted a law stating that new heating systems would have to be powered primarily by renewable energy. There were fierce protests against this, especially in the eastern part of the country; Hebek was accused of forcing people to install expensive heat pumps.
When she came into office, Reich immediately struck down this provision, saying: “The HEAVING Act has lost our trust and divided society. We are charting a new course.”
At the same time, the minister announced his plans to build new gas-fired power plants.
Claudia Kaempfert, a researcher German Institute for Economic Research (DIW)Reich rejects allegations made by critics who say she has long lobbied for the gas industry.
“His past doesn’t matter as much as his current policies,” Kaempfert told DW. “The problem arises when fossil fuel interests are once again prioritized over renewable energy, [energy] Storage and efficiency. Germany needs future-oriented technologies instead of new reliance on fossil fuels.”
flutters rich wings
Reach received support from the country’s major industry associations from the beginning as it announced that it would prioritize affordability in energy policy. But now the powerful Federation of German Industries (BDI) is also more serious.
Reason: The economy has not grown as expected, although this is certainly also due to international turmoil, such as US President Donald Trump’s unpredictable tariff policy and, from March 2026, the US and Israel’s war against Iran.
Disagreements quickly arose within the federal government over how to address the high energy costs faced by German citizens after the start of the war with Iran.
Finance Minister Lars Klingbeil of the center-left Social Democratic Party (SPD), the junior partner in the government, advocated imposing a tax on energy companies’ windfall profits.
Reich immediately rejected the idea and publicly declared that the SPD was continually making proposals that were “expensive, ineffective and constitutionally questionable.”
Chancellor Friedrich Merz then urged him to show greater restraint towards the smaller coalition partner.
However, as a rule, the Chancellor tends to defend Reich: when she recently cut subsidies for private solar installations, Merz defended her on public broadcaster ARD.
“We pay high subsidies from the federal budget for electricity that is not needed. Catharina Reich has proposed how we can limit it, how we can prevent it, how we can reduce it,” the chancellor said, adding that Reich had decided to no longer pay compensation if solar power cannot be fed into the grid, for example during grid overloads.
The rich tempt China
At the end of May, Reich began his first trip to China. For two days she had been demanding Chinese investment to help Germany advance in the technology sector. Thirty-five business representatives from companies and startups in the renewable energy and e-mobility sector were invited along with him.
Reach’s strategy in China focused on showing respect and recognition by praising the strengths of its host country. It remains to be seen whether it will be paid or not.
This article was translated from German.