Hetzner Raises Prices for First Time Since 2019 — Still the Cheapest

Hetzner has announced price increases of 5-8% on its cloud server products, effective July 2026. The adjustment — Hetzner's first since 2019 — reflects rising energy costs in Germany and infrastructure investment, including the upcoming US datacenter in Ashburn, Virginia.

The New Pricing

Dedicated server pricing remains unchanged for now, though Hetzner indicated that "selected dedicated server products" may see adjustments in "early 2027."

Context: Energy Costs

German industrial electricity prices have risen approximately 30% since 2021, driven by the energy transition (Energiewende) and reduced availability of cheap Russian natural gas. Hetzner's Falkenstein and Nuremberg datacenters consume significant power — an estimated 30-40 MW across their facilities.

Hetzner has invested in renewable energy (hydropower in Finland, solar at datacenter sites) to stabilise long-term energy costs, but German grid electricity remains a significant operational expense. The price increase likely reflects these higher input costs.

Competitive Context

Even after the increase, Hetzner's pricing remains extraordinary:

Hetzner is still 55-67% cheaper than competitors for equivalent specs. The price increase narrows the gap slightly but doesn't change the competitive landscape.

At €15.75/month for a 2 vCPU/4GB/NVMe server, Hetzner is charging slightly above what most competitors charge for 1 vCPU/2GB — and delivering twice the specs.

The US Datacenter Factor

Hetzner's price increase coincides with their US expansion plans. Building out a new datacenter in Ashburn, Virginia requires significant capital investment — real estate, power infrastructure, networking equipment, and server hardware.

The question is whether the price increase is directly funding the US expansion or simply reflecting higher operational costs. Hetzner's public statements suggest it's both: energy costs drove the timing, but infrastructure investment (including the US datacenter) made the increase unavoidable.

Customer Reaction

The reaction from Hetzner's community has been muted — a reflection of both the modest increase size and the understanding that Hetzner's prices were unsustainably low.

A 7% increase on a €7.50/month server adds €0.55/month. Most customers would rather pay €8.05/month to a stable, well-invested Hetzner than see the company cut corners to maintain €7.50/month pricing. The alternative — infrastructure degradation from underinvestment — is worse than a small price increase.

Some customers on LowEndTalk and Reddit have noted that even with the increase, Hetzner remains cheaper than any serious competitor, and that the company's track record of stable pricing (one increase in 7 years) compares favourably to competitors who raise prices annually.

What This Means

If you're a Hetzner customer: Budget for the increase. It's small enough that most deployments won't notice. If your infrastructure costs are so tight that €0.55/month matters, you have bigger problems than hosting pricing.

If you're considering Hetzner: The increase doesn't change the value proposition. Hetzner remains the price leader. Use the current pricing if you can sign up before July; budget for the new pricing for long-term planning.

If you're a competitor: This increase gives you a small competitive window, but don't celebrate. A 7% increase on already-unbeatable prices doesn't make you competitive — it just makes Hetzner slightly less impossibly cheap.

For the hosting market: Hetzner's price increase signals that the era of "cheaper every year" cloud hosting may be ending. Energy costs and infrastructure investment are real expenses that even the most efficient operator can't avoid forever. Expect other hosts to follow with their own increases, citing the same energy cost pressures.

Our Take

This is a non-event dressed as news. Hetzner's first price increase in seven years, amounting to €0.30-2.50/month depending on plan, doesn't change anything meaningful about their competitive position. They remain the cheap option, they remain in Europe, they remain unmanaged.

The more interesting story is what the increase signals about Hetzner's US expansion commitment. If you're raising prices to fund infrastructure investment, you're serious about that investment. The US datacenter isn't a marketing announcement — it's a capital allocation decision backed by customer pricing.

Hetzner customers should accept the increase as the cost of a well-funded, expanding infrastructure provider. The alternative — a Hetzner that cuts corners to maintain 2019 pricing — would be far worse.