Again a dynamic bidding procedure for offshore wind power auctions
Year of issue 2024
Date of issue 2024.06.07
Zero-cent bids for all sites auctioned
The Bundesnetzagentur has today published the preliminary results of the ongoing offshore wind power auctions. Several zero-cent bids were submitted for each of the two sites up for auction, requiring a dynamic bidding procedure for the second time.
"The auction results are good news for Germany's energy transition. It is pleasing to see that the companies do not need any funding for developing their offshore wind power. The zero‑cent bids make it clear that offshore wind power is economically attractive,"
said Klaus Müller, President of the Bundesnetzagentur. "This leads to a reduction in the offshore transmission link costs for consumers."
Dynamic bidding procedure – lower electricity costs and sustainable marine conservation
The bidding deadline for the auctions for non-centrally pre-investigated sites was 3 June 2024. The Bundesnetzagentur had put up for auction two sites for offshore wind farms in the North Sea with a total capacity of 2,500 MW. Nine bids were received for the N‑11.2 site with a capacity of 1,500 MW and seven bids for the N‑12.3 site with a capacity of 1,000 MW.
For each of the two sites all bidders submitted bids with a value of zero cents per kilowatt hour deciding not to request funding. In the event that this happens the Offshore Wind Energy Act provides for a dynamic bidding procedure to differentiate between bidders in a competitive environment. The award is then given to the bidder willing to pay the highest amount for a site. A software-based online bidding procedure helps determine how much the bidders are willing to pay.
Most of the proceeds go towards bringing down electricity costs and a smaller share towards marine nature conservation and promoting sustainable fishing.
Bidding procedure to be held soon
The dynamic bidding procedure includes up to 13 bidding rounds each day. A bid level generally amounts to €30,000/MW (which is equivalent to €45mn for the 1,500 MW site and €30mn for the 1,000 MW site).
The Bundesnetzagentur intends to conduct both procedures simultaneously, starting on 17 June 2024. It is not possible to determine how long the procedures will take and how high the winning bids will be.
In last year's dynamic bidding procedure the Bundesnetzagentur awarded bids amounting to €12.6bn for four sites with a total capacity of 7,000 MW.
The Bundesnetzagentur will announce the successful bids on its website. The dynamic bidding procedure is based on the rules published in advance on the Bundesnetzagentur's website (www.bundesnetzagentur.de/1003334 in German).
Further information about the auction for offshore wind farms can be found at www.bundesnetzagentur.de/windaufseeausschreibungen24-1 (in German)