EnBW, Dong secure German spoils
UPDATE: North Sea projects bid average is close to market rate
Dong and EnBW have won contracts to build offshore wind farms in Germany’s first competitive auction.
EnBW has secured the bulk of the 1.5GW on offer with its 900MW He Dreiht project in the German North Sea.
The developer won with a bid of zero, pledging to build and operate the wind farm without the support of a feed-in tariff and relying instead on the market rate.
He Dreiht wind farm is slated to be operational in 2025. It will export power via the BorWin5 grid hub.
EnBW executive Dirk Güsewell said the returns from the project are “considerably above” the cost of capital and “remain attractive”.
Danish company Dong Energy has meanwhile secured the remaining 590MW.
The developer will be able to build its Borkum Riffgrund West 2, Gode Wind 3, and OWP West wind farms with the capacity.
Gode Wind 3 will export power via the 600MW DolWin6 grid hub, to be operational in 2023.
The Borkum Riffgrund West 2 and OWP West wind farms will connect to the 900MW DolWin5 grid hub, to be commissioned in 2024.
Dong said it would comment on the earlier than expected result later today following internal analysis of the outcome.
The average price of the auction was €0.0044/kWh on top of the market price while the highest successful price was €0.06/kWh.
BNetzA chief Jochen Homann said the average bid price is “far below expectations” and has proved the industry has “unlocked medium and long-term” cost reduction targets “which will lead to a reduction in funding to an extent that had not been expected”.
A second 1.61GW auction will be held in April next year and will include 60MW not awarded this year.
Image: Dong Energy