Hamburg Offshore Wind Conference 2015

Yesterday and today everything revolves around offshore wind energy at the Hotel Hafen Hamburg in the northern German town where the 13th Hamburg Offshore Wind Conference – organized by the DNV GL – is being held. Main topic of the discussions is the new tender system which will be introduced in Germany from 2016.

Michael Pollmann, Hamburg State Secretary for Environment and Energy, in his welcome note pointed to the fact that the leading industrial nations have – for the first time ever – agreed to accelerate the decarbonization of the world until 2050 at the G7 summit in early June. The development of renewable energy and particularly of offshore wind energy will therefor be the focus in the coming years. He stressed the role of German renewable energy policy as a role model. "There is tremendous international interest in what happens in Germany," says Pollmann, who worked previously in South America and can report firsthand also the interest in economic, political, and technology development. Renewable energy is not only important for generating electricty anymore, but also for other industries such as electromobility, storage technology or power-to-heat.

He admitted, the current debate in Germany about the planned tenders led him to an "intellectual overwork", because the discourse is being led in many different directions by the experts. Since it is not always easy for politicians to follow up. He pleaded to work together to ensure that the "received actor diversity and competition as a means of cost reduction" persists. "We must avoid for the momentum to pass," said Pollmann.

The following panel discussion with high-ranking representatives from industry, politics and economy was all about the tenders. Prof. Dr. Claudia Kemfert of the German Institute for Economic Research stated very clearly: "I am no friend of the tenders." Experiences of other countries would clearly show that there is no cost reduction. The already conducted tendering processes in photovoltaics in Germany, which are seen as a trial run for wind energy, have shown that there was a "strategic bidder behavior". The Institute also finds it inconclusive, why the federal government comes up with the idea to abandon a working concept and shift to experiment with a new system just now.

Norbert Giese, who is a board member of the German turbine manufacturer Senvion but also works for the German Engineering Federation (VDMA), shared a similar view. Currently, Germany has a unique position: The actor diversity in the construction of offshore wind farms is greater than in any other European country. But this is threatened by the introduction of tenders. He also pointed out that there would be a gap in the expansion of offshore wind energy after 2020, because the development time for offshore wind farms, which currently stands at more than ten years, does not fit with the transitional periods scheduled by the federal government.

Urs Wahl, currently Acting Managing Director of the wab (Windenergieagentur Bremerhaven), warned of a "fear-driven debate". The industry is currently in turmoil since nobody knows exactly how things will go. Therefore, there is fear of the future costs, anxiety about jobs, fear of loss of reputation for Germany. He pleaded for exactly thinking through the new EEG law in advance, because there is no simpe return to its previous state after a system modification, if changes should prove to be not conducive. He called on all parties to act "prudently".

Dr. Nico Nolte of the Federal Maritime and Hydrographic Agency of Germany, BSH, could still laugh about the implication of his agengy becoming unemployed with the introduction of tenders, but he also had to admit that there is some uncertainty. It must finally be determined yet what will happen, for example, with the authorizations which have already been granted, or what should happen in the future with the planning approval process.

Jürgen Blume, Managing Director of Iberdrola Renovables Offshore Germany, pointed out that the role of offshore wind power in the future energy mix should not be underestimated. Iberdrola is currently building the offshore wind farm Wikinger in the German Baltic Sea which will go online in 2017. Especially the interaction between farms in the North Sea and Baltic Sea would mean that "Somewhere, there is always a blowing wind". Therefore the offshore wind energy is the most stable form of energy among renewables. However, the previously advertised lid must be raised, because the currently scheduled numbers are far too low. "A market should define for themselves how much is still possible", Kemfert added. The wab also calls for the abolition of the "rigid lid", as proposed.

The only supporter of tenders among the participants of the panel was Felix Würtenberger from Vattenfall. The Swedish company believes that this is a "correct, efficient and fair model." The company recently won the tender for Horns Rev 3 in Denmark with an extremely low power cost price and therefore sees itself well positioned for the German tenders. However, he also pointed out that certain extension numbers should not be exceeded, otherwise the German offshore industry will get problems. He also laid emphasis on the finding that by no means has the end of the flagpole being reached in cost reduction: Larger turbines, more efficient foundations and an improved financing system still offer room for price cuts.

Finally, Norbert Giese wanted to emphasize a fact that often comes up short in the public debate: Due to the enormous electricity production because of renewable energy, Germany does indeed have the lowest industrial electricity prices of all EU Member States, but these prices are just only for the companies buying their electricity at the electricity exchange market. On the other hand prices for German consumers are the second highest in the EU – only in Denmark they are even higher. This imbalance needs to be resolved urgently, not to endanger public acceptance of renewable energy.