4C is now TGS

We are excited to announce a significant milestone in 4C Offshore's journey. Our integration into the TGS family marks the beginning of a new era in offshore wind market intelligence.

Learn what this means for you!

DONG Energy named winner in German capacity auction

By: Tom Russell 13/04/2017 4C Offshore

General Windfarms

DONG Energy has been named as one of the winners of the first offshore wind capacity tender round being held by the German Government.

With the 590MW awarded, DONG can now move forward with the realisation of three offshore wind farms, Borkum Riffgrund West 2 (240MW), Gode Wind 3 (110MW) and OWP West (240MW).

Samuel Leupold, Executive Vice President and CEO of Wind Power at DONG Energy, says: “We’re pleased with being awarded three projects in the first of two German auction rounds, and we have good opportunities to add further capacity to our winning projects in next year’s German auction. Today’s results contribute to our ambition of driving profitable growth by adding approximately 5GW of additional capacity by 2025.”

The three projects are planned to be commissioned in 2024, subject to Final Investment Decision by DONG Energy in 2021.

For two of the projects – OWP West and Borkum Riffgrund West 2 (240MW)– DONG Energy made bids at zero EUR per MWh, i.e. these projects will not receive a subsidy on top of the wholesale electricity price. The Gode Wind 3 project was awarded based on a bid price of EUR 60 per MWh.

Samuel Leupold says: “The zero subsidy bid is a breakthrough for the cost competitiveness of offshore wind, and it demonstrates the technology's massive global growth potential as a cornerstone in the economically viable shift to green energy systems. Cheaper clean energy will benefit governments and consumers – and not least help meet the Paris COP21 targets to fight climate change. Still it’s important to note that the zero bid is enabled by a number of circumstances in this auction. Most notably, the realization window is extended to 2024. This allows developers to apply the next generation turbine technology, which will support a major step down in costs. Also, the bid reflects the fact that grid connection is not included.”

Samuel Leupold continues: “Financial discipline is key to us. We are of course reflecting the project’s exposure to market risk in the cost of capital applied. We see a solid value creation potential in this German project portfolio and will now begin to further mature the projects towards a Final Investment Decision (FID) in 2021.”

DONG Energy will be responsible for the turbines, array cables and offshore substation, while grid operator TenneT will be responsible for construction, operation and ownership of the onshore substation and the export cable.

DONG Energy noted that a number of factors enabled its zero subsidy bids, this includes larger turbines within the 13-15MW range. The company explained that increasing the turbine size will boost is electricity production whilst reducing the number of turbine positions, cutting costs during construction as well as during a lifetime of operations and maintenance.

Furthermore OWP West and Borkum Riffgrund West 2 will be combined into one large-scale project with the option of adding additional volume in next year’s auction to further increase the total size of the project. The projects are located next to DONG Energy’s Borkum Riffgrund 1 which means that operations and maintenance can be done from DONG Energy’s existing operations and maintenance hub in Norddeich.

The German authorities have also approved the possibility to extend the operational lifetime of the asset from 25 to 30 years.

On the 13th April EnBW Energie Baden-Württemberg AG announced that it has successfully been awarded connection capacity for the He Dreiht offshore wind farm. EnBW submitted a bid for a the construction of the wind farm with a capacity of up to 900MW and without subsidy support under the country's Renewable Energy Act (EEG).

The German capacity auction will take place on 1st April 2018 and a capacity of 1610MW in grid connection capacity.

Winning candidates will be awarded with an offshore grid connection and subsidy valued according to the their bid. The offshore construction schedule will be dependant on the connection availability, which in turn will depend on progress and allocation constraints of the grid expansion.

As a result of the tenders, 500MW of offshore wind capacity is expected to be delivered in the Baltic Sea during 2021 and a further 500MW in the North Sea in 2022. Between 2023 and 2025 delivery will be 700MW per annum in the North Sea.

For more information please follow the links provided. Alternatively you can click here to see German offshore wind farms on our interactive map.

Premium

4C Offshore Premium, our most popular subscription, gives you full access to use the 4C Offshore WebApp which includes exclusive offshore wind, transmission and vessel reports, news and downloads.

Request a 30 minute Demo

DONG Energy named winner in German capacity auction

Back to News

Trending News!