A study by the Foundation indicates that the current bidding process, which awards contracts to the highest bidder for offshore wind farm sites, could have long-term economic and energy policy drawbacks. The high bids may increase electricity costs, as operators are likely to transfer these expenses to industries through power purchase agreements (PPAs). Sectors such as transportation, including Deutsche Bahn, and the chemical industry could face significant impacts due to these rising costs.
Karina Würtz, managing director of the Offshore Wind Energy Foundation, emphasized the need for change: “The results of the analysis must be understood as a call to the next federal government to finally correct course here.” The Foundation’s study underscores the importance of revising the tender system to mitigate potential cost increases and support Germany’s renewable energy goals.
To address these challenges, the Foundation suggests implementing two-sided CfDs, which would provide a stable pricing mechanism for both developers and consumers. Additionally, it recommends limiting the tender volume per bidder to encourage competition and prevent market concentration. The introduction of realistic prequalification criteria is also proposed to ensure that only viable projects move forward, enhancing the overall effectiveness of the tender process.
These proposed reforms aim to create a more balanced and sustainable framework for offshore wind expansion, aligning with Germany’s commitment to renewable energy. By adopting these measures, the Foundation believes the government can better support energy-intensive industries while maintaining affordable electricity prices for consumers.
