RWE to Build Denmark’s Largest Offshore Wind Farm Without State Aid

Denmark's largest offshore wind farm
RWE will build Denmark's largest offshore wind farm to date (RWE)

Published Jan 28, 2022 7:44 PM by The Maritime Executive

Germany’s RWE group has completed the contracts with the Danish Energy Agency to build and operate the largest wind farm built in the country’s 30-year history of developing offshore energy. The contract for the lease, which is located off the Danish west coast was highly sought after resulting in favorable terms for the country. It will be the first time that a Danish offshore wind farm has been built without state aid.

The Thor Wind Farm will have a capacity of 1 GW and is scheduled to reach full operation in 2027.  Total investment costs have been estimated at approximately $2.3 billion, but the way the concession is structured and based on the price of electricity, the site is expected to generate more than $400 million in revenue for the Danish government. The favorable terms are the result of the auction to win the lease that included all the well-known companies developing offshore wind assets.

"I'm delighted about this agreement with RWE and Thor Wind Farm because it shows that Danish wind power is a good business on the world market,” said Dan Jørgensen, Minister for Climate, Energy and Utilities. “We built Denmark's first offshore wind farm 30 years ago because we had a vision and a belief in the potential of offshore wind power. Today, we can see that further deployment is not solely driven by political ambition but also, to an entirely new degree, by strong market forces. Wind power is not only good for the climate, it can also be really good business.” 

For the RWE, the Thor project will help the company to achieve its goal to triple its global offshore wind capacity by 2030. RWE plans to grow its global offshore wind capacity from 2.4 to 8 gigawatts.

"Scandinavia, and Denmark in particular, is an important strategic growth market for us. Denmark not only has very favorable wind conditions, the country also has ambitions to deploy even more offshore wind power. We’re looking forward to working with the Danish Government and other partners, and in the upcoming months we’ll be starting our preliminary surveys,” said Pål Coldevin, Executive Vice President for Offshore Development Nordics, Poland and Baltics at RWE Renewables.

RWE also has a 20 percent stake in the Danish Rødsand 2 offshore wind farm just south of Lolland. The wind farm, which has been in operations since 2010, has an installed capacity of 207 MW.