Eneco finds investing in an offshore wind farm too expensive and withdraws from bidding war

28 mrt 2024 om 07:56 Update: 1 uur geleden

Eneco is not participating in a bidding war for a new offshore wind farm. The energy company, which invested money in hundreds of offshore wind turbines, believes the risks are becoming too great. Wind farms are becoming more expensive and the chance of delays during construction is increasing.

The new bidding war concerns the IJmuiden Ver Alpha and IJmuiden Ver Beta parks. They must supply 4 gigawatts of power, enough for approximately four million households. The outgoing cabinet wants 21 gigawatts of power to come from offshore wind farms by 2030.

But Eneco is not participating in the investment round, even though it is one of the major financiers of offshore wind farms.

The energy company is struggling with the higher costs for offshore wind farms. This is partly due to increased interest rates, but also due to higher steel and copper prices. According to Eneco, the fact that more wind farms are being built and therefore more demand for wind turbine construction also drives up costs.

Eneco also points to an increase in the risks of delays during construction. This can lead to high fines.

Different rules in bidding wars

Eneco further criticizes that the government pays less attention to the innovative character of the bidder during the bidding process and attributes more value to the highest price offered. Competing for the construction of a wind farm is starting to look more like a real auction. This leads to higher costs, says Eneco.

The energy company suggests that the government assumes part of the risk of falling electricity prices in new bids and that when assessing bids, more value is attached to bidders who also invest in green hydrogen.