The Dutch Government has begun accepting bids to create 700 MW of offshore wind power capacity. The new tender is unique in that bidders must be prepared to rely on wholesale electricity prices alone without government subsidies or guaranteed prices. Despite being potentially risky for bidders, the tender has already attracted at least one participant.
The two projects will involve constructing two 350 MW windfarms in the North Sea, with the successful bidders being responsible for the estimated cost of $2.7 billion. With no subsidies needed, the initiative could mark a new shift towards green energy.
The decision to hold a subsidy-free auction follows a drop in the subsidies awarded at the country’s two previous tenders for wind power projects. In April this year, Denmark’s Dong energy broke the link between offshore wind power and subsidies by offering to build two German projects without government support.
Advances in technology, economies of scale, and lubricants, such as those available from Mobil UK stockists, have already made some onshore windfarm projects very competitive, but the new zero-subsidy auction may be a game changer for offshore wind power.
Vattenfall, the first company to bid in the auction, says it sees the project as an important milestone in the move towards renewable energy. The company announced:
“It is a major milestone for Vattenfall and would be an important step to become fossil free within one generation. Vattenfall is firmly committed to the green transition of Northern Europe, investing more than EUR 2 billion in renewable energy between 2017-2018.”