From IberBlue Wind, a leader in the offshore wind energy sector, they highlight that the auctions in Spain and Portugal are emerging as more competitive compared to the Danish model, which has left its MWs deserted.

Julio Vera, Director of Institutional Relations at the company, states that the design of the Danish auctions presents serious disadvantages that have discouraged the interest of international investors.

The auction scheme in Denmark is characterized by the absence of state support or mechanisms to stabilize future revenues, such as contracts for difference (CfD), commonly used in other European countries.

“The Danish system simply requires promoters to pay for the right to build, which creates an unsustainable race to the bottom,” highlights the executive in an interview with Energía Estratégica España.

This approach increases initial costs and adds financial uncertainty.

Additionally, Denmark does not cover the costs of grid connection, forcing promoters to bear this investment, a factor that contrasts with the more attractive models in other countries.

According to Vera, this restrictive design limits the efficient development of the offshore wind sector.

Advantages of the Iberian Design

In contrast, Vera praises the Iberian models, highlighting their ability to attract investments thanks to a design that reduces financial risks and ensures stable income flows. “Spain and Portugal have adopted approaches that offer greater security to promoters, which is key to ensuring the success of projects,” he asserts.

In Spain, the “3 in 1” model combines in a single auction the award of resources, grid access, and the necessary permits, simplifying the process and offering better conditions for investors. Meanwhile, Portugal opts for a sequential model that grants greater flexibility in project planning.

“Each country approaches this matter from a different perspective, but the common goal is to create a competitive and attractive framework for developers,” explains IberBlue Wind’s Director of Institutional Relations.

What about the price?

Regarding prices, Vera notes that it is not prudent to make direct comparisons between countries.

“In offshore wind, every project is unique and depends on multiple variables. Comparing prices without knowing all the details of the project can be very risky,” he says.

However, he highlights that models with stabilization mechanisms, such as those in the Iberian Peninsula, tend to foster more competitive and sustainable prices.

Julio Vera concludes by emphasizing that the evolution of auctions in Europe should focus on ensuring balanced conditions that promote the stability and competitiveness of the sector. Models like those of Spain and Portugal, he claims, are clear examples of how to structure successful offshore wind auctions.