The Danish Energy Agency has launched Denmark's largest tender to date of offshore wind farms in six areas in the North Sea, the Baltic Sea and Kattegat, which must be completed by the end of 2030. The tender makes it possible to establish a total of at least 6 GW and up to 10 GW of offshore wind.
1 GW can supply 1 million households with electricity, which means that the tendered wind farms will be able to produce enough electricity to cover all households in Denmark and a whole lot more in other countries. The existing Danish offshore wind farms currently have a total capacity of 2.7 GW.
The distribution of the wind farms
Three of the wind farms will be located in the North Sea, two in the Kattegat and one in the Baltic Sea. Each wind farm must be established with a capacity of at least 1 GW, except for Hesselø, where only 0.8 GW is required. All wind farms will be able to utilise the maximum potential of the areas by so-called overplanting.
The deadline for bids for the wind farms in the North Sea is 5 December 2024, while the deadline for the wind farms in the Baltic Sea and Kattegat is 1 April 2025.
Financial framework
Applicants must submit bids with the fixed annual concession payment that they are willing to pay to the state for a period of 30 years. In addition, the state must have co-ownership of 20 per cent of the offshore wind farms. There is no state aid in the tender.
According to the calculations on which the tender is based, the capital expenditure for one offshore wind farm is expected to be approx. DKK 16 billion and each farm is expected to create around 9,500 full-time equivalents.
The state's co-ownership will be realised through a state holding company that will contribute pro rata equity to the project company for each offshore wind farm.
New sustainability requirements
In the political Supplementary Agreement on the tender framework for 6 GW offshore wind and Energy Island Bornholm from May 2023, it was agreed that new requirements for sustainability and social responsibility will be introduced, which participants must meet in order to bid for the tender. The purpose of the new requirements is to ensure that all bidders meet the same high standards within these two areas, even if they compete on price.
The requirements include third-party verified environmental product declarations and life cycle analyses, the use of recyclable turbine blades, and installer’s and subcontractors’ compliance with social clauses on social dumping, human rights and the use of trainees.
In addition, the wind farms' impact on the marine environment and biodiversity must be both monitored and positive.
The tender procedure
The parties behind the political agreement on the tender note that, due to the size of the tender and the requirements for sustainability and state co-ownership, it is a complicated tender, which also has a tight schedule from the launch of the tender until the wind farms are completed.
Horten has advised on the tendering of offshore wind farms in Denmark for the past 10 years and has in-depth knowledge of and experience with the Danish tendering rules, with the different types of project contracts and with the offshore wind turbine industry. We can advise on the entire process from the preparation of bids and negotiation of contracts to the establishment of the offshore wind farm.
Link to press release from the Ministry of Climate, Energy and Utilities:
Danmarkshistoriens største havvindsudbud skudt i gang (kefm.dk)
Link to press release from the Danish Energy Agency:
Danmarkshistoriens største havvindsudbud er i gang | Energistyrelsen