Denmark plans offshore wind tender with up to $8.3 bln subsidy
COPENHAGEN, May 19 (Reuters) - Denmark will launch an offshore wind tender with a capacity of three gigawatt (GW), enough to power three million homes, its energy ministry said on Monday, offering subsidies to developers of up to 55.2 billion Danish crowns ($8.32 billion).
The offshore wind industry has grappled with skyrocketing costs, higher interest rates and supply chain bottlenecks, prompting governments to halt or postpone tenders due to a lack of interest from bidders.
"We need more secure green power and energy to make Denmark and Europe independent of energy from Russia," Energy Minister Lars Aagaard said in a statement.
The bids offered in the tender will determine the level of subsidy needed, with a cap set at 55.2 billion crowns over 20 years.
"It is the bid price and the development of electricity prices that determine whether it will be necessary to support the projects, or whether money will come to the state," the ministry said.
Denmark in January announced it would halt all ongoing offshore wind tenders to revamp its model, saying that a framework where no subsidies were offered did not work under existing market conditions.
A month earlier, the Nordic country had failed to attract any bids in its biggest offshore wind tender yet, with analysts pointing to a rigid auction model and a failure to adapt to a changed economic reality for renewable energy projects.
Denmark has been a pioneer in both onshore and offshore wind, and is home to turbine maker Vestas (VWS.CO), opens new tab and the world's largest offshore wind developer Orsted (ORSTED.CO), opens new tab.
($1 = 6.6318 Danish crowns)
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