Uncertainty for wind power in Germany: Federal states join call to postpone offshore wind auctions

The situation in Germany’s offshore wind energy sector remains uncertain, with calls for a review of the country’s auctions to support wind farm construction growing louder in recent months. Germany’s most recent offshore wind auction was a major flop, with developers submitting no bids at all. Industry representatives have called for next year’s planned auctions to be postponed, and representatives of some federal states are now joining them. They say another unsuccessful round could send a fatal signal to the sector.

The German government faces a major decision about the future of its offshore wind energy sector. In recent years, Germany’s auction system was changed after developers began submitting bids without seeking guaranteed prices for their projects, in order to secure the areas they needed to develop them. In response to this strategy, the government redesigned the auctions: instead of receiving support, developers now compete to see who will pay the state the most for the right to build and operate an offshore wind farm.

The system has long been criticised by industry associations, which warned of the risk of waning investor interest. The situation came to a head in the latest auction, held in August this year, when investor interest hit rock bottom—not a single bid was submitted. In response, industry associations began calling on the government to redesign the auction system, arguing that its current form poses a serious risk to the country’s industry and climate targets.

Another failure could be fatal

According to Clean Energy Wire, ministers from two federal states have now joined these calls: Lower Saxony and Schleswig-Holstein. The ministers say the federal government should propose new terms for offshore wind farm auctions. If next year’s planned auctions go ahead under the current conditions, they could fare just as poorly as this summer’s auction. According to Christian Meyer, one of the ministers, that would be “a fatal signal for this industry”.

At the same time, targets for offshore wind farm construction should not be cut, nor should progress towards them be slowed. Germany plans to increase installed offshore wind capacity to 30 GW by 2030, with capacity expected to reach 70 GW by 2045. According to Meyer, cutting these targets would also put a thousand jobs in Lower Saxony and elsewhere at risk.