Belgium launches offshore wind turbine auction on October 28

The European Commission has recently approved a state support mechanism worth 682 million euros for the development of new offshore wind farms in Belgium. This approval allows for the auction of a wind farm with a capacity of 700 megawatts (MW) in the Princess Elisabeth zone, located in the North Sea. The auction process is set to commence on October 28, as announced by the resigning Minister of Energy, Tinne Van der Straeten. Developers will participate in a bidding process where a maximum price of 95 euros per megawatt-hour (MWh) is established. To ensure financial viability, the government will compensate operators for any shortfall in electricity prices below this threshold, while developers will be required to repay the difference if market prices exceed the set maximum. This mechanism is designed to encourage participation from developers by providing a safety net against fluctuating market conditions. The auction format incentivizes developers to offer lower prices, as those who propose more competitive bids will receive better scores in the auction process. This approach aligns with recent trends observed in other countries, such as the United Kingdom, where a recent auction yielded winning bids between 65 and 70 euros. The launch of this auction marks a significant step in Belgium's commitment to expanding its renewable energy capacity, particularly in offshore wind energy, which is crucial for meeting future energy demands and environmental goals.