HomeRenewablesWindDamages cap could uncork German offshore wind

Damages cap could uncork German offshore wind

A deal to limit grid companies’ liabilities from delays in linking offshore wind turbines could clear the path for stalled projects from RWE and E.ON SE, according to analysts.

An 82.5 per cent cut in the ceiling on damages, down from €100m to €17.5m, will enable network operators to get insurance cover and raise funds, said Sophia von Waldow of Bloomberg New Energy Finance.

Backed by Germany’s coalition government, a revised draft bill has been endorsed by the parliament’s economy committee, but faces opposition from main opposition parties. Under the energy bill, developers will be compensated for delays and utilities can pass on costs exceeding the caps to consumers.

EnBW recently delayed a decision to invest at least €1.5bn ($1.9bn) in a North Sea wind farm over uncertainty about when the project would be connected.

Dong Energy has also suspended work on Borkum Riffgrund II after failing to get a date for a connection. E.ON and RWE have also suffered delays.

“Germany is now much more interesting for large investors from Asia that have already been open to invest,” said Von Waldow.

“It’s bad news for the consumer, who will probably have to shoulder a greater share of the burden.”

TenneT TSO GmbH recently announced delays of several months in linking to wind farms, holding up major projects.

Germany added only 45 MW of offshore wind in the first half of 2012 but targets 25 GW by 2030 as part of its shift from nuclear generation.

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