Dong Energy secures 590 MW capacity in German offshore wind tender

Danish renewables-focused utility Dong Energy A/S (CPH:DENERG) said it was awarded a total of 590 MW project capacity in the latest German offshore wind tender.

The auction awarded both long-term subsidy under the EEG and grid connection capacity, paid by electricity consumers, for power plants coming online after December 2020.

The company submitted six projects and won three, namely the 240 MW OWP West, the 240 MW Borkum Riffgrund West 2 and the 110 MW Gode Wind 3, all in the German North Sea.

Final investment decision for the projects should be taken by 2021 and commissioning is scheduled for 2024.

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

"It’s important to note that the zero bid is enabled by a number of circumstances in this auction", Samuel Leupold, Executive Vice President and CEO of Wind Power at DONG Energy, said in a statement.

"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,” he noted.

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.

The Danish company currently operates 902 MW of offshore wind in Germany with Gode Wind 1 and 2 and Borkum Riffgrund 1. In addition, it is building the 450 MW Borkum Riffgrund 2 which is expected to come online in 2019.

German utility Energie Baden-Wuerttemberg AG (ETR:EBK), or EnBW, also said today its bid to build a 900-MW offshore wind farm without state subsidies has been successful in Germany's first offshore wind auction.

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