Denmark to halt offshore wind tenders to revamp subsidy model (updated)

Vestas Wind Systems A/S

31/01/2025 11:55

(Adds background, minister quote and detail from statement,
detail on Orsted in paragraphs 2, 4-8)
       COPENHAGEN, Jan 31 (Reuters) - Denmark will halt all
ongoing offshore wind tenders as the existing framework where no
subsidies are offered does not work under current market
conditions, its energy minister said on Friday.  
    The global offshore wind industry has been hit by surging
costs, rising interest rates and supply chain bottlenecks.
Denmark said in December that its latest tender for wind at sea
had failed to attract any bids.
    The government will now start preparations to launch a new
offshore wind tender this year with a capacity of two to three
gigawatts (GW), where state subsidies might be offered, energy
minister Lars Aagaard told a press conference.
    "Our assessment right now is that we might be required to
support offshore wind. It's not because we're happy about it,
but it's necessary," Aagaard said. 
    Denmark has been a pioneer in both onshore and offshore
wind, and is home to turbine maker Vestas  VWS.CO  and the
world's largest offshore wind developer Orsted  ORSTED.CO .
Orsted said on Friday it would replace its CEO as it seeks to
arrest an 83% slump in its share price since its 2021 peak.
    The government also said it planned to help finance a 
hydrogen pipeline running from Denmark to the German border.
    Using excess power generated by wind at times when it is not
needed by users to produce so-called green hydrogen is seen as
critical to Europe's green transition, but development has
stalled.
    "At this stage, time is of the essence, and therefore the
government is committed to making export to Germany possible
from 2030," the energy ministry said in a statement. 

 (Reporting by Stine Jacobsen and Isabelle Yr Carlsson
Editing by Jason Neely and Frances Kerry)
 ((stine.jacobsen@thomsonreuters.com; +45 2156 90 10;))