A successful energy transition depends on offshore wind

Turn auctions into action

We must turn auctions into action

In 2024, more than 50 gigawatts of offshore wind will be auctioned off globally. And politicians plan to use all these gigawatts of renewable energy to lower electricity prices, protect energy supply and tackle climate change. But today, the gap between this plan and what is actually done to realise it, is widening.

More and more offshore wind projects are delayed or even called off. We have to close this gap between say and do.

The perfect plan

In 2024, authorities plan to auction nearly 50 gigawatts of offshore wind projects globally. This marks a record in the history of wind energy and shows that government plans for wind power are becoming increasingly ambitious.

But plans are not wind parks. Many of these plans get delayed and may not materialize into wind parks at all because offshore wind auctions are designed to raise the most capital - not the most wind turbines.

So how do we turn auctions into action?

Check out the solution paper for our 3 recommended steps.

  

In short

3 steps to reform offshore auctions and close the say-do gap

  

Introduce revenue-sharing mechanisms

Uncapped and exorbitantly capped negative bidding and high lease fees weaken project economics by adding financial risk.

Harmonise prequalification requirements

Prequalification requirements should include binding turbine technology commitments to ensure bids in auctions are submitted with technology that is ready to be deployed. 

Create value with non-price criteria

As an alternative to awarding projects based on price only, auction designs can award projects based on their potential to create value for the surrounding energy system or society.

  

Targets, declarations and goals are not wind farms

Every year brings new promises for the energy transition. Promises in form of ambitious targets, highly touted declarations and firm goals. These promises are important to faciliate a shared commitment to deliver a more sustainable future. But, when these promises do not materialise into action, we are left with nothing but a plan. So it does not matter how many gigawatts we set as our 2035 target or how well-intended our next declaration is if there is not a clear line of sight to turning them into actual renewable energy generation. 

So let's save the celebrations for wind farms actually getting build.

  

The case for turning auctions into action

  

50 GW of auctions

in 2024, making it the highest-volume year ever for offshore wind auctions

450 GW offshore

wind capacity is needed in the EU alone to reach net zero in 2050

+10 GW cancelled

offshore wind projects in 2023 across the globe due to unviable project economics

   

OPINION

Trust in the energy transition requires reforming the offshore auction process

This year will see the largest volume of offshore wind up for auction in the history of global energy. With wind project plans becoming more ambitious, how can we ensure that they materialise into real projects - projects that can deliver on both lofty political commitments, and more affordable energy for worried consumers?

  

If you are interested in more

Read about other pressing policy issues, our world-leading offshore turbine or why not come join us and help Vestas create a more sustainable future?

Accelerated permitting is a must

Offshore auction design is not the only obstacle for a faster energy transition. Permitting of new wind farms is another pressing issue - explore our campaign here

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