The failure of the 3GW Danish offshore wind tender to attract any bidders is a “huge setback” for the country’s green transition, according to Green Power Denmark.
The auction, the largest yet run by Copenhagen, was closed yesterday after no entries for the three sites on offer and the trade group said it will delay the country’s energy independence goal.
“The green transition in Denmark has stalled right now,” said Green Power Denmark chief executive Kristian Jensen.
“Too few wind turbines are being built both at sea and on land, and if that situation does not change, we will continue to depend on electricity from black energy sources.
“Politicians need to understand that wind turbines are not money trees. They are tools that are supposed to make us independent of fossil energy and hostile powers.”
Jensen explained one explanation for the tender flop is that wind turbines have increased in price due to inflation and rising commodity prices, and that interest rates are now significantly higher than they were a few years ago.
“This is putting pressure on the economics of the projects,” he said.
However, the economic conditions in the market are not the whole explanation, he added.
The UK, Poland, the Netherlands and a number of other countries are currently conducting tenders for offshore wind turbines, which end in bids. However, the terms are often such that the state pays for grid connection, and there is the possibility of state aid, he said.
:In Denmark, investors do not know whether they can sell the energy from wind turbines at a reasonable price,” he said.
“It is too slow to switch the heating of our buildings and industrial production to electricity. And there is still great uncertainty about whether it is possible to sell electricity in the form of hydrogen.”
The trade group added: “The lack of bids for offshore wind farms in the North Sea creates a critical situation for the wind turbine industry. And it is a huge setback for the green ambitions. It ties us to fossil fuel imports for a longer period of time, and it weakens our ability to get electricity at competitive prices – to the benefit of companies and consumers.”
The tender in the North Sea is the first part of a total tender for 6GW of offshore wind turbines.
The other 3GW are being tendered in inland waters with a bid deadline of 1 April.
When the result of that tender is known, the government and the Danish Parliament should take stock as soon as possible, believes Green Power Denmark.