BP, TotalEnergies Victorious in $14B Wind Auction Offshore Germany

Germany’s offshore wind journey started a new chapter July 12 as the country’s regulator named energy giants BP and TotalEnergies as top bidders in an auction that brought in €12.6 billion (US$14 billion).

The winning bids mark both companies’ entry to the German offshore wind market amid a push toward development of lower-carbon energy resources.

Four sites were up for grabs—three in the North Sea and one in Baltic Sea—with a total combined volume of 7 gigawatts (GW), according to German energy regulator Bundesnetzagentur. The auction, which utilized a dynamic bidding process for the first time after several zero cents per kilowatt hour (kWh) were submitted, took place as Germany targets 30 GW of offshore wind capacity by 2030.

“The results confirm the attractiveness of investing in offshore wind energy in Germany,” said Klaus Müller, president of the Bundesnetzagentur. “Competition in offshore wind power has never been so high.”

BP landed rights to develop two sites, with winning bids of €1.83 million/MW for site N-11.1 in the North Sea and a bid of €1.56 million/MW for another site in the North Sea. Located in water depths of about 40 m, the sites have combined generating capacity of 4 GW.

Total bids for BP were about €$6.7 billion (US$7.46 billion).

The company said it aims to have the projects, which will use fixed-bottom turbines because of shallow depths, connected to the grid by year-end 2030.

“These awards are a huge milestone for BP’s decarbonization plans in Germany and are a strong reflection of our wider strategy,” Anja-Isabel Dotzenrath, BP’s executive vice president of gas and low carbon energy, said in a news release. “The renewable power we aim to produce will anchor the significant demand we expect for green electrons for our German operations, from a whole host of products and services including green hydrogen and biofuels production, electric mobility growth and refinery decarbonization.”

TotalEnergies was awarded two concessions: a 200 sq km site in the North Sea capable of producing 2 GW of electricity and a 100 sq km, 1 GW site in the Baltic Sea with a 1 GW potential. Together, the wind farms will produce enough electricity to power 3 million homes, the company said. Bids for the two sites totaled about €5.8 billion (US$6.46 billion).

“Our entry into offshore wind power in Germany, Europe's largest electricity market, is a key step in the implementation of our strategy to become an integrated profitable player in the electricity markets,” said TotalEnergies CEO Patrick Pouyanné. “After the commissioning of a floating LNG regasification unit at the Lubmin terminal in January 2023, this is a further commitment by TotalEnergies to deploy our multi-energy strategy in Germany and contribute to the country's and Europe’s energy security.”

BP and TotalEnergies emerged as the top bidders following successive bidding rounds, which reached as high as 72 rounds for the lone Baltic Sea concession.

The regulator said 90% of the proceeds from the offshore wind auctions will go toward reducing electricity costs. Another 5% will be used for marine nature conservation and promotion of sustainable fishing.

The latest offshore wind wins boosts BP’s global offshore wind pipeline to 9.2 GW net, BP said.

TotalEnergies global offshore wind portfolio has 11 GW of projects in development, under construction and in production, the company said, excluding Germany.