Lithuania

Lithuania

Lithuanian offshore wind auction proposals ‘could raise project prices’

Lithuanian parliament to vote on proposals made “too quickly” and with “little consultation”, industry bodies warn

Baltic Sea offshore wind farms have been built off Germany, while countries like Lithuania and Poland are also due to add capacity (pic credit: EnBW)
Baltic Sea offshore wind farms have been built off Germany, while countries like Lithuania and Poland are also due to add capacity (pic credit: EnBW)

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Newly proposed changes to Lithuania’s offshore wind auction design could prompt developers to place higher bids in future rounds, according to industry groups.

The revised draft law for renewable energy proposes Lithuania supporting only part of the electricity produced by the winning bidders, instead of all the output.

It also proposes developers compete for the lowest volume of electricity to be supported, as well as for the lowest prices.

These measures would create additional risk and lead to higher bid prices, as well as increasing financing costs and, therefore, higher total lifetime costs, WindEurope warned.

WindEurope urged Lithuania to maintain its original proposal for a double-sided contract for difference (CfD) based solely on strike price. It said this would stabilise revenue, ensure competition, lower the costs of offshore wind to society and enable investors to minimise their cost of capital.

The Lithuanian Wind Energy Association said the changes had been proposed “too quickly,” providing insufficient time for thorough consideration. Therefore, it “would not be inclined to support any changes to the existing support scheme until at least a thorough analysis of the changes has been carried out,” the association’s executive director, Urtė Daškevičiūtė, told Windpower Monthly.

Two Lithunian government committees recently approved changes to the country’s draft law for renewable energy, which would set the terms for future offshore wind auctions.

The Lithuanian Parliament needs to approve the draft bill before it can be signed into law, with a vote expected in November or December.

Lithuania plans to launch its first offhore wind tender in September 2023, with winners due to be announce in the first quarter of 2024.

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