Zombie projects: Investors hesitate to build offshore wind farms in auctioned areas in Germany

Offshore wind development in Germany is running into a problem. Investors bid billions of euros at auctions for the rights to build wind farms in the North and Baltic Seas, but are now hesitating to proceed with some of the projects. According to the industry, up to 16 GW of planned wind farm capacity and investments worth tens of billions of euros could be at risk. The problem is high costs and uncertainty about future returns.

Between 2023 and 2025, Germany awarded investors the rights to build offshore wind farms with a total installed capacity of 17.8 GW. According to the German Offshore Wind Energy Association (BWO), projects with up to 16 GW of installed capacity could face difficulties moving forward. If investors do not ultimately proceed with the projects, the industry says this would also mean lost orders for turbine, cable and foundation manufacturers and other suppliers.

The problem has arisen, among other reasons, because of the exceptionally high sums investors were willing to pay for offshore sites. In the 2023 auction alone, the winning bids for four sites totalled 12.6 billion euros. BP secured two of them, with the projects now being developed by the Jera Nex BP joint venture. Two further auctions in 2024 raised 3.02 billion euros. In total, the winners of auctions held between 2023 and 2025 paid 16.6 billion euros for the sites awarded to them.