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Offshore wind industry puts hopes on new auction design to meet expansion targets

Posted on August 19, 2026

Clean Energy Wire

Stakeholders from the energy industry and civil society have submitted their positions on a draft bill for a reform of Germany’s Offshore Wind Energy Act. The law has been in place since 2016 and regulates spatial planning, on-site exploration, auctions and grid connection for Germany’s offshore wind farms of the North Sea and the Baltic Sea. 

The German government said it will stick to its target of installing 70 gigawatts (GW) of new turbine capacity by 2045, up from roughly 11 GW currently. 

Ursula Heinen-Esser, head of the Renewable Energy Federation (BEE), said the 70 GW target would be attainable. “But this urgently requires an internationally competitive and reliable investment framework,” she argued, adding that contracts for difference (CfDs) should replace the current practice of negative price bids. 

An auction for new offshore wind capacity in August 2025 had ended without any submitted bids for the first time, raising worries that the envisaged expansion targets might not be met. Moreover, the reported withdrawal of energy companies TotalEnergies and BP from major offshore wind power projects, for which they had offered billions of euros to access available construction areas had caused a stir in the industry earlier this year. 

The German Offshore Wind Energy Association (BWO) welcomed the planned reform’s introduction of two-sided CfDs as a financing instrument for new projects. BWO head Stefan Thimm said the scheme should become the central vehicle for offshore wind expansion, as it reduces investor risk and makes implementation more likely. The CfDs’ design should take cost factors in the supply chain and other aspects into account through an index that makes calculations easier, an approach already pursued in other countries, Thimm added. 

The industry group also called for returning projects to the auctions that were awarded between 2023 and 2025 but have not received a final investment decision, which includes the major projects that were scrapped earlier this year. This would cover projects with a capacity of up to 16 GW and a funding volume of up to 50 billion euros. “An orderly return mechanism creates more clarity and opens a path to implementing projects with new investors,” Thimm said. 

The government’s draft does not include such a provision. It argues that this would ensure the binding nature of the tendering process and meet the need for long-term planning horizons in the planning and approval process. The government cabinet could agree the reform as early as next week (26 August), and it would then be sent to parliament. 

The Association of Local Utilities (VKU) said the 70 GW target was too high, given that turbines tend to become less productive when built in high density due to wind shear effects. The VKU said the maximum capacity in Germany’s territorial waters should be limited to 50 GW, while cross-border projects in other countries’ territorial waters should be made easier. The government, at the beginning of this year, hosted a major European offshore wind energy summit at which North Sea countries agreed to deepen cross-border cooperation on new projects. 

VKU head Ingbert Liebing said that installed capacity is not the decisive metric, but rather the actual electricity output of each installation, as well as the technology’s integration into the broader energy system. “Each euro that we spend on costly offshore grids ultimately has to pay off in the energy system,” Liebing said. 

Environmental NGO WWF said the current proposal falls short on marine ecosystem protection, criticising in particular that the weighted importance of non-financial criteria in the auction design, including sustainability aspects, should drop from 40 percent to 15 percent. “The steering function ceases to exist,” WWF marine protection expert Lisa Babak said. 

Established environmental protection features, such as the noise-reduced method of laying turbine foundations, are absent from the proposal, which effectively meant a worsening of conditions for ecosystem protection, Babak said. She called for strengthening ecological criteria in the auction design to ensure a steady financing for marine ecosystem protection measures, and also warned against expanding designated construction areas in the North Sea as a means to reduce turbine density in existing offshore wind energy zones. 

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