The Transmission System Operators (TSOs) of Germany (50Hertz), Denmark (Energinet), Sweden (Svenska kraftnät), Finland (Fingrid), Estonia (Elering), Latvia (AST), Lithuania (Litgrid), and Poland (PSE) have issued a joint call to strengthen cross-border collaboration in offshore wind energy and the development of associated grid infrastructure.
This initiative, formalised through the Vilnius Declaration in April 2024, sets the foundation for hybrid interconnection projects and multi-purpose offshore energy hubs. These steps aim to not only enhance Europe’s energy security but also accelerate the path toward climate neutrality.
“Regional cooperation is key to fully harnessing the potential of offshore wind and optimising the energy resources of the Baltic Sea,” the TSOs emphasise in the expert report.
The Baltic Sea’s diverse wind profiles and favourable offshore conditions make it a prime location for large-scale renewable energy projects. The region’s unique geography enables the distribution of offshore wind farms over larger areas, reducing wake effects and increasing overall energy efficiency. This strategic placement also minimises environmental impact and ensures a more stable energy supply.
€90 Billion in Investments Planned by 2050
The roadmap established by the Baltic Offshore Grid Initiative (BOGI) foresees an unprecedented investment of up to €90 billion by 2050 to develop advanced energy infrastructure across the region. Flagship projects include the Bornholm Energy Island, which will add 3 GW of offshore wind capacity and feature direct transmission links of 2 GW to Germany and 1.2 GW to Denmark.
Another key project is the Baltic WindConnector, designed to deliver 2 GW of generation capacity and an interconnector between Estonia, Latvia, and Germany. These projects reflect a shift towards a more interconnected European energy market, capable of responding to demand fluctuations and reducing dependency on fossil fuels.
The increased reliance on offshore infrastructure also raises concerns over the security of critical energy assets. Recent geopolitical tensions and sabotage incidents targeting undersea cables and pipelines have underscored the vulnerability of Europe’s energy networks.
In response, Baltic countries, alongside NATO, have introduced initiatives like “Baltic Sentry” and are finalising a Memorandum of Understanding on Critical Infrastructure Protection.
“Protecting these infrastructures is vital for the stability and energy sovereignty of Europe,” the report warns, highlighting the importance of coordinated action among national governments, security agencies, and private sector operators.
Innovative Financing Solutions and Cost Sharing
Financing these ambitious projects presents a significant challenge. The current EU cost-sharing framework, under the TEN-E regulation, is considered insufficient to meet the scale of investment required. The TSOs propose a combination of enhanced regional planning, expanded private-sector involvement, and greater access to EU funding mechanisms, such as the Connecting Europe Facility (CEF).
The successful experience of the Nordic cooperation model, Nordel, is cited as a best practice. “A shared narrative and strong political support were key to overcoming economic and regulatory barriers,” the report notes, adding that new governance models are needed to facilitate fair cost allocation and reduce bureaucratic delays.
Logistical Challenges and Supply Chain Reinforcement
Meeting future offshore wind capacity targets will require a significant expansion of the supply chain. The surge in demand for critical components has prompted companies like Vestas to announce a new blade manufacturing facility in Poland, while NKT is investing €1 billion to expand its high-voltage submarine cable production in Sweden.
These investments not only aim to secure the supply of essential infrastructure but also to create thousands of new jobs across the Baltic region. The development of a robust industrial base is seen as critical to ensuring Europe’s technological leadership in offshore wind, particularly in the face of growing competition from Asian manufacturers.
Green Hydrogen Production: A Strategic Complement
Another pillar of the Baltic strategy is the integration of green hydrogen production. The TSOs advocate for the deployment of hybrid connections, also known as “overplanting”, enabling offshore wind energy to be directly converted into hydrogen near the point of generation. This reduces the need for costly onshore grid expansions and transmission losses, while supporting the decarbonisation of heavy industries and transport sectors.
In Finland, Fingrid is actively exploring this approach, and Denmark has already introduced technical frameworks to support such hybrid projects. “By integrating hydrogen production with offshore wind, we can optimise resources and accelerate the transition to a zero-carbon economy,” the TSOs assert.
A New Era of Regional Energy Integration
The Baltic Offshore Grid Initiative symbolises a profound transformation in how Europe approaches energy security, sustainability, and industrial growth.
Through large-scale investments, innovative project models, and a renewed focus on infrastructure resilience, the Baltic Sea region is poised to become a driving force for sustainable growth and regional energy integration.
“We are facing a historic opportunity to turn the Baltic Sea into a powerhouse of sustainable growth and regional energy integration,” the TSOs conclude, calling for immediate action and sustained political commitment.
