Uncertainty stalls German offshore wind development

Strabag has postponed its planned €300 million investment in the German offshore wind industry, reacting to what it calls an uncertain legal situation in the country’s offshore electricity market.

The contractor had planned to channel the funds into its gravity-based foundations technology business for offshore wind, but has now suspended its plan to build a new factory and two special ships that would have fabricated and transported its foundation systems.

Strabag CEO Hans Peter Haselsteiner said, “There are too many reasons against it at this time – from the uncertain legal situation and uncertain future of energy policy on the German market to the fact that both storage technology for electricity from renewable sources and transport possibilities for getting the electricity from the producer to the consumer are lacking.”

The news comes after Germany introduced a new law at the start of 2013 that put in place a lower cap on the penalty that grid companies must pay for delays in connecting offshore wind farms to the mainland.

Under the new legislation, network operators will have to cover a maximum of €110 million in costs for delays to connections, with anything above that passed on to energy consumers.

Dutch electricity transmission grid operator TenneT has welcomed the new law, after warning the German federal government in November 2011 that the construction of grid connections for offshore wind farms in the North Sea was no longer possible without regulatory change.

Nevertheless, another energy producer – German company EnBW – has also announced that it is postponing a €1.5 billion investment for planned North Sea wind farms.

In November last year, EnBW chief technical officer Dr Hans-Josef Zimmer said, “We need legislative clarity and reliable underlying conditions. A responsible decision on the construction of the wind farm will only be possible once these are in place and a binding date can be stated for connecting the wind farm to the grid.”

EIB support

Meanwhile, EnBW’s Baltic 2 project – the largest offshore wind farm to be developed to date in the German Baltic Sea – was selected by the European Investment Bank (EIB) on 14 January this year to receive €500 million in financing.

An EIB spokesperson said that the Bank was confident that the Baltic 2 project would progress smoothly, citing the fact that it worked together with EnBW on the similar Baltic 1 project, and intended to use a different grid connection company – 50-Hertz – to connect the wind farm to the mainland.

“We have had very good experience on the Baltic 1 project and are also confident that the new law in Germany will provide more security,” the spokesperson said.