RWE wins German wind auction, Vattenfall could exercise right of entry

By: Tom Russell 07/09/2022 BNetzA

General Windfarms

The German Federal Network Agency (Bundesnetzagentur or BNetzA) announced that RWE Renewables Offshore HoldCo Four GmbH (RWE) has been named winner of its auction for 980 MW of offshore wind. The tender concerned the N-7.2 area for which RWE was successful for a zero subsidy bid.

“The zero-cent bid further confirms the attractiveness of investments in offshore wind energy in Germany. It shows that companies assume that they can market wind power profitably," said Klaus Müller , President of the Federal Network Agency.

Despite its success, RWE could be gazumped by Vattenfall Atlantis 1 and Global Tech 2 Offshore Wind GmbH (Vattenfall) which has a right of entry for area N-7.2. Vattenfall holds a statutory entry right through its previous project Global Tech II which was discontinued following the switch to government central tenders and unsuccessful in the 2017/18 transitional tenders. Statutory entry right allows Vattenfall to acquire the site following the tender providing it matches the winning bid. The right of entry must be exercised by 31 October 2022.

This is the second auction round under the central offshore wind mechanism, the first being completed in September 2021 for areas N-3.7 (225 MW), N-3.8 (433 MW) and O-1.3 (300 MW). All sites were awarded at 0 ct./kWh. Iberdrola and Northland Power exercised rights of entry for O-1.3 and N-3.8 via the projects Nordsee Two and Windanker. N-3.7 will be developed by RWE.

BNetzA stated the award goes hand in hand with the right to a grid connection – financed by the electricity consumer via the grid fees – and the opportunity to operate the offshore wind farm for over 25 years. In addition, the awardee has the right to apply to the German Federal Maritime and Hydrographic Agency (BSH) for planning approval for the development of the area with an offshore wind farm. The offshore wind farm is scheduled to go into operation in 2027.

The BSH had previously extensively examined the area on behalf of the Federal Network Agency and determined the suitability of the area for the construction of an offshore wind farm. The BSH examined, among other things, the marine environment, the subsoil and the wind and oceanographic conditions for the area. The costs of the preliminary investigations will be passed on to the bidder who has been awarded the contract.

To remind, back in July the BSH published the draft of the area development plan and the environmental reports for the North Sea and Baltic Sea. It is expected to come into force at the beginning of 2023.

The area development plan serves as a basis for the future tenders for offshore wind energy and the associated grid connections. It follows revised targets in the WindSeeG Act which include targets 30 GW by 2030, at least 40 GW by 2035 and at least 70 GW by 2045. The draft of the area development plan submitted by the BSH includes area with a planned output totalling approximately 60 GW planned until 2038.

For more information on offshore wind farms worldwide, click here.

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