EnBW and TotalEnergies have won development rights in the latest German offshore wind tender after agreeing to pay just over €3bn in total lease fees.
EnBW has secured the 1GW N-12.3 site in the German North Sea after beating off rival applicants in the round-robin dynamic bidding exercise that reached €1.1m per megawatt for the acreage.
The German utility will pay a total of €1.1bn for the lease rights.
A second bidder, using the special purpose company Offshore Wind One GmbH, was awarded the contract for area 1.5GW N-11.2 at a bid value of €1.3m/MW.
The company was controlled by the RWE-TotalEnergies partnership. RWE told reNEWS it was part of the alliance but has now pulled out on economic viability grounds.
TotalEnergies will pay almost €2bn in total lease fees.
“Building upon the successful award of concession N-12.1 in the German North Sea last year, the award of the N-11.2 site will enable TotalEnergies to establish a 3.5GW offshore wind energy hub, building on the quality of both sites and taking advantage of the development and operational synergies between them” said president gas renewable and power of TotalEnergies Stéphane Michel.
“This marks a new step for the deployment of TotalEnergies Integrated Power strategy in Germany after the acquisition of Quadra Energy, one of the top three aggregators of renewable electricity production and of Kyon Energy, a prominent developer of battery storage solutions.
“TotalEnergies is also very pleased to contribute to Germany’s decarbonisation targets.”
BP and TotalEneriges won development rights for four sites in last year’s 7GW German dynamic tender round with combined bids of over €12 billion.
“As in the previous year, the awardees were determined online in several bidding rounds with increasing bid levels. Several bidding rounds were carried out per day. A total of 46 bidding rounds were carried out for area N-11.2 and 55 rounds for area N-12.3,” said federal network agency BNetzA, which ran the process.
“With the award, the successful bidders are entitled to carry out a planning approval procedure for the construction and operation of wind turbines on the site as well as the right to connection and grid connection capacity.”
BNetzA president Klaus Müller added: “The results show the attractiveness of investing in offshore wind energy in Germany.
“They are another important step towards achieving the offshore expansion goals.”
EnBW chief executive Georg Stamatelopoulos added: “Winning the auction represents another important milestone in the restructuring of our generation portfolio.
“We want to expand renewable energy capacity to between 10GW and 11.5GW by 2030 and be a climate-neutral company by 2035.
“To this end, we are investing a total of €40bn euros in the energy transition by 2030, around a third of our total investment alone in the construction of wind farms and solar parks as well as flexibly controllable and hydrogen-ready gas power plants.”
Board Member for Sustainable Generation Infrastructure Peter Heydecker added: “The contract is a major success for our offshore team and shows that we can realize cost-efficient offshore wind projects in Germany and Europe.
“We already operate four offshore wind farms off the German coast. What’s more, we are currently building ‘He Dreiht’ in the North Sea, Germany’s largest offshore wind farm to be built without state funding.
“We are now looking forward to building another offshore wind farm in our home market of Germany.”
EnBW said it plans to sell much of the electricity produced by the offshore wind farm to industrial customers in the future through power purchase agreements.
“Even before construction work had started on our current ‘He Dreiht’ project, we had already marketed more than half of the electricity using PPAs,” said Heydecker.
He added: “The considerable interest shown by customers validates our decision to conclude PPAs for our next offshore wind farm as well, enabling us to play our part in decarbonizing the industry.”
The proceeds from the offshore tenders are primarily used to reduce electricity costs and protect marine nature and promote environmentally friendly fishing.
The portions of the awarded bid values intended for sustainable marine protection must be paid to the federal budget within one year.
The electricity cost reduction component is to be paid to the transmission system operator over a period of 20 years, starting with the completion date of the wind farm in 2031.