Offshore wind power

Danish experiences with

offshore wind auctions

© SEAS-NVE, Jesper Blæsild

Offshore Wind Development in Denmark Wind Power Generation
% of Danish Power Production
25 years of experience
60.00%

 1991: First Danish offshore wind farm Vindeby 50.00%

(5 MW)

 2011: 868 MW offshore capacity 40.00%

 2019: ~ 1,700 MW offshore capacity including 30.00%

28 MW R&D
20.00%

 2021: ~ 2,3 MW offshore capacity

10.00%
 2027: 2 new large-scale offshore wind farms
for an additional capacity of up to 2,000 MW
0.00%
 2030: 2 energy islands connected to 5,000 1994 '00 '05 '10 '15 ´20

MW
Offshore wind farms in Denmark
DE-RISKING is the key word

Denmark has been able to reduce the

Levelized Cost of Energy (LCOE) of offshore

wind by de-risking as much as possible

the development of offshore wind projects
 The Danish tender process

1. Site 2. Preliminary 3. Technical 4. Pre- 5. Tender

selection studies dialogue qualification award

Maritime Spatial • Strategic Transparent • Financial and Lowest price

Planning from Environmental dialogue and technical per kWh is the
rough mapping Assessment negotiation with pre- only final award
to fine screening potential bidders qualification criterion
• Metocean requirements
surveys (wind, to participate
wave, current) in the final
• Geo bid
investigations • No local
content
requirement
The One Stop Shop
Why a One-Stop-Shop?

Clear, transparent, smooth consenting process

Developers: Creating confidence by reducing risks &

uncertainties

Other authorities: Better understanding of the projects

16 August 2021 Page 7

 Main involved authorities (1)
ENERGINET
Danish Nature Danish Working Danish Transport, Danish Business
Transmission System Environment Construction and Authority
Operator (TSO)
Agency Authority Housing Authority

• Grid • SEA • HSE • Air Traffic • Potential

connection • Approval of requirements conflicts of
• SEA local plans interest
• Metocean for grid
surveys connection
• Geo on land
investigations
 Main involved authorities (2)

Maritime Danish Coastal Danish Culture Danish Ministry

Authority Agency of Defence
Authority

• Shipping • Coastal • Heritage • UXO

activities protection areas • Military Air
• Wind farm • Sand dune • Shipwreks Traffic
marking conservation
zones
The key is communication!
One-Stop-Shop Consent Procedure

Project‘s
Screening
lifetime

Preliminaries
studies
1 - Screening
2 - Market dialogue

• Timetable for the tendering process

• Conditions for pre-qualification

• Award criteria and financial terms

• Compliance penalties

• Environmental assessment

• Issues related to the grid connection

• …
3 - Prequalification

Technical capacity Financial capacity

• References that demonstrate • Turnover requirements

experience • Financial statements
• Planning, design, construction • Equity/debt structure
methods, procurement, quality
control, etc.
Danish Energy Agency

Monday, August 16, 2021

 4 - Preliminary surveys (coordinated by the Transmission System Operator)

Preliminary geo Unexploded

Environmental Metocean Ordonnances
investigations
surveys surveys (UXOs)

- Complete SEA - Wind, wave and - Geophysical & - Unexploded

before bidding current geotechnical mines and
conditions surveys bombs from the
- Greatest
World Wars
conceivable - Understanding - Understanding
environmental of the local of the local - Safety
impact conditions seabed
(design) conditions
(design)
- Viable financial
business case
6 - Permitting

1. License to carry out preliminary investigations

(with Concession Agreement)
2. License to establish offshore wind turbines (with
Concession Agreement)
3. License to exploit wind power for 25 years
4. Approval for electricity production in
compliance with the electricity supply legislation

16 August 2021
 • Regulatory framework
impacts risks and
therefore final bids
A careful distribution of • Continuously fine-
risk between authorities tuning of the
responsibilities and
and bidders is key to associated risks has
been important to
minimise costs optimise the
framework aiming for
further cost reductions
 • Recomment a phased
approach easing into
auctions for offshore
wind in Vietnam.
A robust auction scheme • Avoid boom and bust
requires careful in Vietnam by giving a
clear timeline for when
development in close auctions will be held,
and what will happen
dialogue with market in the meantime.
players • Dialogue, dialogue and
more dialogue
 • Stable long term
framework and
sensible allocation of
risks call for a COVID19
Urgent need to handle delay allowance.
onshore capacity delayed
because of COVID19 • How Vietnam handles
this current challenge
- risk to hamper trust in will send an important
signal to the
Vietnam wind market international players
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