Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Subside free wind farms risk ruining industry reputation, warn executives

The GE-Alstom Block Island Wind Farm stands in this aerial photograph taken above the water off Block Island, Rhode Island, U.S., on Wednesday, Sept. 14, 2016. The installation of five 6-megawatt offshore-wind turbines at the Block Island project gives turbine supplier GE-Alstom first-mover advantage in the U.S. over its rivals Siemens and MHI-Vestas. Photographer: Eric Thayer/Bloomberg
Energy storage, renewables, and carbon capture are among the sectors set to benefit

Energy companies that stunned the world by offering to build wind farms with no subsidy may ruin the industry’s reputation by never actually delivering on their promises.

That’s the warning of industry executives, who are cautious about the future of zero-subsidy offshore wind farms planned in Germany this year. Developers led by Energie Baden-Wuerttemberg AG and Dong Energy A/S are betting they can sell the electricity they produce from the wind farms at a profit without any help from taxpayers.

“The offshore wind industry needs to be careful,” Irene Rummelhoff, executive vice president at Statoil ASA’s New Energy Solutions unit, said at the Bloomberg New Energy Finance Summit in London on Tuesday. “They’re taking on these options, and when you get to the delivery date, if they’re not able to build the projects, it will ruin the reputation of the industry.”

The German government may not have been strict enough with penalties and pre-qualification criteria in its auction to ensure developers actually deliver on their winning bids, said Thomas Karst, senior vice president at MHI Vestas Offshore Wind AS.

“The regulatory power lies with the owners of the concessions and they may or may not get built, so that model from the regulatory point of view doesn’t really work,” Karst said at the same conference.

It’s not just in Germany where the costs of offshore wind power are falling. The U.K. and Netherlands have both seen record low bids during the past year that surprised even industry insiders. Last week, developers led by Dong won bids to develop wind farms in British waters for as little as 57.50 pounds ($77.61) a megawatt-hour, well below the cost of the next nuclear reactors.

Winning bidders in both the Dutch and German auctions based business cases on giant wind turbines, soaring as high as The Shard in London and generating as much as 15 megawatts of power each. Those machines haven’t been built yet and aren’t due until the next decade.

The upcoming Dutch auction won’t deliver zero subsidy bids, said Marie de Graff, head of partner relations at Dong. She said the Danish utility is still considering its position for that round.

Recommended for you

More from Energy Voice

Latest Posts