As of December 2012, Germany had some 248MW of offshore wind capacity feeding into the onshore network, of which 60MW was from the Alpha Ventus project in the North Sea and nearly 50MW from the Baltic 1 project. The rest was from Bard Offshore 1, under construction since December 2010 in the North Sea, which will contribute 400MW once it is completed in late 2013 or early 2014.
Construction work has begun on several other projects, including the remaining 300MW of Bard Offshore 1. This could see around 1GW going online in 2013. In the North Sea, Windreich, the developer for the owner consortium (Stadtwerke München, HEAG Südhessische Energie and others) of the 400MW Global Tech 1, began installing the foundations in autumn 2012 with completion slated for the end of 2013.
The 30 foundations were installed in September 2012 at EWE and Enova’s near-shore 108MW project Borkum Riffgat, with completion also possible in 2013. By early December 2012, Trianel had installed half of the 40 foundations for the first 200MW phase of its 400MW Borkum West 2 project, with turbine installation due to begin in summer 2013. RWE Innogy is at work on the foundations for its 295MW Nordsee Ost, but completion is not expected until mid-2014 due to cabling delays.
In the Baltic Sea, EnBW has begun preliminary work on its 288MW Baltic 2 project. Windreich said at the end of November that its 273MW Deutsche Bucht and 400MW MEG 1 projects were also running to plan, with financial close expected "shortly".
On the downside, in mid-November, EnBW postponed an investment decision for its 500MW EnBW Hohe Sea project, due to lack of clarity on future framework conditions. In the same month, Südweststrom, a conglomerate of municipal utilities, abandoned plans to acquire Bard Offshore 1, currently owned by Unicredit Bank. In October, Dong Energy deferred development of its 349MW Borkum Riffgrund 2 due to transmission delays, and RWE Innogy revealed in July that it would not take a final decision to invest in the 330MW first phase of its Innogy Nordsee project without absolute clarity on the network connection to shore. So, while 2013 looks likely to be a positive year, the outlook thereafter is uncertain.
A law tackling risk liability in connection with offshore transmission cables to shore, passed by the German federal parliament at the end of November, is helpful but insufficient to keep the sector on track. "We are sceptical that the law completely solves the problems. We believe the state needs to take a participation in the offshore cable networks," says Ronny Meyer, managing director of Windenergie-Agentur Bremerhaven/Bremen.
"State development bank KfW’s planned stake of at least 25% in the subsea electricity cable under development between Germany and Norway shows the way," says Meyer. It was announced on 4 December that this new cable for electricity trading between the two countries is slated for commissioning in 2018.
The offshore cable liability law — which rolls much of the risk of late completion or outages of offshore wind transmission cables onto consumers — is "a decisive milestone in developing the legal framework for building offshore transmission networks", according to Joerg Kuhbier, chairman of Stiftung Offshore-Windenergie. But "it’s still completely unclear how pending network expansion measures are to be financed", he adds. He insists temporary involvement of German development bank KfW in financing the next few offshore cables to shore is "absolutely necessary".
The debate about the cable liability law "has resulted in a lost year, in which no new orders have been granted", says Meyer. "This is bad for component suppliers who have invested in manufacturing facilities and now need continuity."
On top of that, Germany’s environment and economy ministers have kicked off a discussion about a reform of the Renewable Energy Act and changes to the feed-in tariff system, but say there will be no concrete changes before the next federal election in September 2013.
If investors do not know what payments per kilowatt hour of offshore wind generation can be expected in 2015 or 2016, then they will not take decisions to invest. We can now expect another two hard years until politicians have decided on the revision of the Act.