TotalEnergies, EnBW winners of German offshore wind auction; New York Sunrise project gains final approval

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TotalEnergies, EnBW awarded offshore wind projects in Germany

France's TotalEnergies and German utility EnBW won rights to build offshore wind projects on German North Sea sites that are slated to start operations in 2031.

In a competitive auction, TotalEnergies won the rights to develop a 1.5 GW site at a strike price of 1.96 billion euros ($2.1 billion), while EnBW was awarded a 1.0 GW site at 1.1 billion euros, Germany's Federal Network Agency said on June 21.

The projects were awarded at an average strike price of around 1.2 million euros per MW, the regulator said, down from 1.8 million euros/MW in a July 2023 auction. The sites are located in the North Sea, approximately 120 km northwest of the German archipelago of Heligoland.

The German government implemented a dynamic bidding process after receiving 16 bids with a bid value of zero cents per kilowatt hour, it said. Around 100 bidding rounds were conducted.

Last year, TotalEnergies was awarded a 2 GW site in the North Sea and the company will be able to take advantage of "synergies” to lower construction costs, it said.

                Forecast EU wind installations

                                   (Click image to enlarge)

Source: WindEurope, March 2024

RWE, Germany's biggest electricity provider, had initially partnered with TotalEnergies in the latest auction, but later pulled out of the consortium. RWE plans to focus on its 1.6 GW North Sea cluster, for which it has taken a final investment decision.

EnBW said it plans to sell much of the electricity from the offshore wind farm to industrial customers through power purchase agreements (PPAs).

EnBW operates four offshore wind farms off the coast of Germany and is also building the 960 MW He Dreiht project. He Dreiht is due online next year, and more than half of the power will be sold to corporate customers through PPAs.

Iberdrola secures permits to build Portugal’s largest wind farm

Spain’s Iberdrola has obtained environmental approval to build a 275 MW wind farm in Portugal that would be the largest in the country.

Europe’s biggest power utility plans to start construction of the wind farm in 2025, once it secures a production permit from the Portuguese government.

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The wind farm will be located next to Iberdrola's 1.5 billion euros Tamega hydroelectric power plant and will use the same grid injection point.

Tamega will effectively become a hybrid hydro-wind power plant, since the two facilities will share substations and other infrastructure.

“All this results in a much lower environmental impact than two independent plants," Iberdrola said in a statement.

The Tamega hydroelectric complex was completed in 2023 and consists of three dams with a total capacity of over 1.1 GW. One of the dams has a pumped storage hydropower component with a capacity to store 40 million kWh − equivalent to the energy consumed in the homes of 11 million people over 24 hours.

New York Sunrise offshore wind project wins final approval

U.S. regulators have approved the construction plan for the 924 MW Sunrise Wind offshore wind farm being developed by Orsted and Eversource, Orsted said in a statement.

"Sunrise Wind is a centerpiece of New York’s clean energy vision, and with this final federal approval we can officially put the construction phase in-motion," the company said.

Danish group Orsted is the largest global offshore wind developer by capacity. Sunrise Wind will feature 94 Siemens Gamesa turbines of capacity 11 MW, according to the construction plan approved by the Bureau of Ocean Energy Management (BOEM).

                        Offshore wind projects in US North Atlantic

                                                          (Click image to enlarge)

Source: Department of Energy's 2023 Offshore Wind Market Report, August 2023.

The Sunrise Wind partners will now accelerate work on the onshore transmission system while offshore construction will start later this year, Orsted said. The project is expected to start producing power in 2026.

In February, New York reallocated power contracts to Sunrise Wind and Equinor's 810 MW Empire Wind 1 offshore wind projects through an expedited solicitation which should preserve plans for local supply chains and boost investor sentiment.

Empire Wind 1 and Sunrise Wind will earn $150.15 per megawatt hour under the new 25-year contracts, far higher than the $110.37/MWh price awarded to Sunrise Wind in 2019. The contracts are also indexed to inflation and include measures to share grid connection costs.

Orsted said in February that Sunrise Wind could move forward because the project was awarded a “bid price level reflecting the current component and financing costs."

RWE starts surveys for 1.6 GW floating wind in California

RWE will start surveying its lease area off the coast of California in the coming weeks for its proposed Canopy Offshore Wind Farm, the German company’s first commercial-scale floating wind project.

RWE won the lease in December 2022 and the waters are too deep for fixed-bottom technologies, requiring floating wind platforms.

Subsea services group Argeo will use an autonomous underwater vehicle to study the seabed in the lease area and between the lease area and the shore, RWE said. Work will start this month and continue until 2025.

The survey aims to identify the best locations for installing wind turbines, anchors and electric cables, and develop strategies to minimize the impact on ecosystems.

RWE said it is coordinating with local fishermen to ensure the fishing industry is not impacted.

The Biden administration wants to build 15 GW of floating wind in the U.S. by 2035 and has set a cost target of $45/MWh, far below current levels. Lower costs will require huge investments in domestic manufacturing to achieve high production volumes.

New York launches clean power tender

New York has launched a solicitation for new large-scale land-based renewable energy projects, including both wind and solar.

Proposals are due by August 8 and projects must be completed by November 30, 2026, the New York State Energy Research and Development Authority (NYSERDA) said.

NYSERDA did not say how much capacity will be awarded and New York is expected to announce the winners by the end of September.

“Once selected, these projects will help accelerate our mission to power our state with affordable, reliable, zero-emission electricity for the benefit of all New Yorkers,” said Governor Kathy Hochul.

The tender will allocate contracts that are indexed to inflation and also includes requirements over stakeholder engagement and criteria that favours projects in disadvantaged communities, NYSERDA said.

The solicitation is part of New York’s efforts to obtain 70% of its electricity from renewable sources by 2030.

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