The encyclopedia · Strategy & Leadership · Strategic decision · 2017–2024
Germany's 2017 offshore auction produced the first zero-subsidy wind farms
Germany's first competitive offshore auction accepted three zero-subsidy bids: 1,490 MW awarded at a weighted average of 0.44¢/kWh.
Bundesnetzagentur · DONG Energy (Ørsted) · EnBW
The solution
Germany's first competitive offshore wind auction, with results published on 13 April 2017, offered 1,550 MW of North and Baltic Sea capacity. Bundesnetzagentur accepted four bids totaling 1,490 MW, and the weighted-average payment demanded was just 0.44 euro cents per kWh — far below expectations by the regulator's own account.
Three of the four projects won with zero subsidy: DONG Energy's OWP West and Borkum Riffgrund West 2 (480 MW combined) and EnBW's 900 MW He Dreiht; only Gode Wind 3 required €60 per MWh. The zero bids were possible because winners had until 2024 to build, could use next-generation turbines, and had to arrange grid connection themselves.
The result flipped the economics of offshore wind: an industry that had consumed billions in feed-in payments was now offering to build without support. The offshore wind foundation called the round a paradigm shift and cited the prices to argue for lifting Germany's 15 GW expansion cap.
Why it worked
- Competitive bidding let developers reveal that subsidy was no longer needed, which an administered tariff could not.
- A later realization window let bidders plan around turbines that did not yet exist.
- Putting grid connection on the developer kept hidden costs out of the comparison.
- A large multi-site round created real competition across pre-developed projects.
What can be applied
When a technology's costs are falling fast, an administered price always lags; an auction lets the market reveal — and undercut — what support is actually needed.
Aftermath
Germany's later rounds moved to negative bidding — by 2023 winners were paying the state for sites — and zero-subsidy offshore auctions followed in the Netherlands and other European markets.
Sources
- Bundesnetzagentur publishes auction results
- German auction attracts first subsidy-free offshore wind deal
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