Offshore Wind Majors Qualified for Norway’s First Auction in March 2024
Norway is set to launch its first offshore wind auction after announcing today that it has prequalified five applicants, including some of the largest developers in the offshore wind energy sector. The auction scheduled for March 18 comes nearly one year after the Norwegian Energy Ministry announced the first competition on the Norwegian continental shelf and as part of a long-term plan to transition Norway from the oil and gas sector to renewable energy.
Among the largest players set to participate in the auction are Aker Offshore, BP, and Statkraft which will make up one of the consortiums. Equinor and RWE will be a second bidder along with Shell, Lyse, and Eviny in a third partnership. Parkwind will be partnering with a division of Ingka, which is the largest franchise/operator of the famed Ikea stores. Energie is also qualified to bid.
Today’s selection follows the announcement last November that seven groups had submitted applications to participate in the auction. The ministry had said it wanted between six and eight bidders and it would consider if it was going to proceed if fewer applications were accepted. In the end, they elected to proceed with five applications while noting that it includes “strong actors” which they said demonstrates the interest in the development of offshore wind on the Norwegian shelf.
The ministry has reported that it was pleased with the strong interest. They noted it came despite significant cost increases for the global offshore industry in 2023. As a condition for prequalifying applicants needed to demonstrate that they would meet minimum criteria for sustainability and “positive ripple effects.”
Two companies, Mingyang Smart Energy and Hydroelectric Corporation, had also submitted applications. They however were not among the companies qualified to participate in the auction.
Today’s announcement clears the companies to participate in the auction for Sorlige Nordsjo, a concession located approximately 85 miles off Norway’s southern coast between Norway and Denmark. The surveys of the area have shown water depths of approximately 170 to 230 feet, which they believe could be developed either with fixed bottom or floating turbines. The government says there will be capacity for up to 3 GW while most of the companies in preliminary discussions suggested they would propose two equal phases.
The government in a 2012 study also proposed a second area known as Utsira Nord off the west coast which due to greater depth would require floating wind turbines. The auction for this site has been delayed while the government last year designated three additional areas also for assessments. The goal was to complete those studies by November 2024 so that they might move to auctions in 2025.
The Norwegian government has an ambition to award areas that have a total potential for 30 GW of offshore wind production by 2040.