The German Federal Cabinet has approved a draft amendment to the Offshore Wind Act (WindSeeG). The legislation is now headed to the Bundestag for parliamentary consideration, with the revised law slated to take effect on January 1, 2027.
The German Offshore Wind Energy Foundation (Stiftung OFFSHORE-WINDENERGIE) welcomed the government’s decision to explore an indexation mechanism for the planning and construction phase but noted that further changes are necessary to address investment risks and the economic viability of offshore wind projects.
The foundation emphasized that the proposed indexation mechanism should result in robust regulation, stating that appropriate indexation is crucial to an investment-ready auction framework.
However, the foundation expressed criticism of the proposed future auction design.
The draft introduces a two-stage model. Initially, it employs a dynamic bidding procedure without a price cap, followed by a contract for difference (CfD) auction as a later option.
The foundation warned that this could lead to particularly attractive offshore wind sites bearing high payment obligations and bids lacking economic viability over the long durations needed for project realization.
The Foundation also noted that the draft “fails to solve the most pressing problem currently facing German offshore wind expansion,” namely, the status of already awarded projects pending final investment decisions (FIDs).
According to the organization, these projects, totaling 16 GW in capacity, face further delays that could create a significant gap in offshore wind expansion, strain the supply chain, and jeopardize Germany’s statutory expansion targets.
The foundation urged for the WindSeeG amendment to provide a one-time, limited option for developers to return awarded sites, with appropriate economic repercussions.
This mechanism should not offer developers a risk-free exit. Instead, it aims to release at-risk sites early and re-tender them under economically viable conditions, ensuring developers cannot bid again on the same site.
“Now it is up to the German Bundestag to further develop the reform in a way that creates reliable investment conditions, secures project realization, and prevents a prolonged expansion gap with serious supply chain consequences,” stated Andreas Mummert, Head of Policy at the Offshore Wind Energy Foundation.
The Foundation supports the government’s goal of implementing the amended WindSeeG by January 1, 2027, but insists the timetable should not compromise a thorough parliamentary review. They called for addressing existing draft weaknesses and establishing a stable, investment-ready framework for offshore wind expansion.
Original Story at www.offshorewind.biz