A political agreement reached by the parties in Denmark will see the tender make use of a two-sided Contract for Difference, a development industry has been lobbying for since the failure of what would have been the country’s largest offshore wind tender in late 2024.
Under the terms of the agreement, developers will also have greater flexibility around the timeframe for installation, which is expected to relieve pressure on the supply chain.
Penalties will remain in place for delays, but have been relaxed in order to accommodate realistic project timescales, and the costs of the site investigations and site surveys for the projects will be borne by the state.
The agreement between the government and other parties in Denmark will result in the construction of sufficient offshore wind capacity to more than double the country’s existing offshore wind capacity. The Government said this is crucial at a time of growing demand for electricity for electric cars, data centres and the production of hydrogen, and is “crucial at a time when Denmark must be able to manage itself with secure green energy independent of other countries.”
In a statement, the Government said the parties to the agreement “have chosen to listen to developers and to the market, which has been characterized by uncertainty and rising costs.” The statement said the market “has demanded greater flexibility and for the state to assume the risk of electricity price developments.
“Therefore, the parties to the agreement are united in providing more attractive terms for Danish offshore wind and have agreed to provide state support so that the offshore wind turbines can be built.”
A total of 3 GW of capacity is being offered across three offshore windfarms in Eastern and Western Denmark. It is anticipated that around 150 turbines, each of 20 MW will be installed across the projects.
The tenders for all three windfarms will open in the autumn of 2025. Nordsøen Midt and Hesselø are expected to have a bidding deadline in the spring of 2026, and Nordsøen Syd in the autumn of 2027.
The first two windfarms are being offered with an establishment deadline of 2032 and the third with an establishment deadline of 2033.
Minister for Climate, Energy and Utilities Lars Aagaard said, “We need more secure green power and energy to make Denmark and Europe independent of Russia. We are taking a big step towards that now.
“There have been global ‘bumps in the road’ in getting offshore wind built in recent years and that is why we have also agreed that the state will lend a helping hand to the projects, if necessary.”