Speaking at the Offshore Wind Energy 2017 event in London on Tuesday (6 June), Baake said he had been caught by surprise when the German offshore wind auction last December produced subsidy-free bids from Danish developer Dong Energy and German utility EnBW.
"This shows how incredibly innovative the offshore wind industry has been," he said. It also shows trust in the market design, he added.
The bidders are confident the market will deliver the electricity prices they need to make the projects viable.
On the back of efforts to push through significant amounts of renewable energy and integrating it into the existing system, Germany and the rest of Europe now need to upgrade the grid infrastructure and strengthen links between countries to build on the success achieved so far, Baake said.
Upgrading the grid to the level that it can support large amounts of power generated by future offshore wind projects is the real challenge for Germany, rather than financing the projects themselves, he said.
But digitalisation will open up a whole new set of opportunities to better co-ordinate supply and demand.
Baake added that Europe-wide integration is also essential. "If you want to transform your power systems and integrate large amounts of renewables, then the wider the system, the easier it becomes."