Germany is taking steps to reform its offshore wind tendering process as energy giants TotalEnergies and BP look to exit the market. But after low numbers of bids in auctions since 2024, why is it taking so long?
Investors and developers are poised for Germany to make long-awaited changes to its offshore wind regime.
Offshore wind companies’ problems with the European country’s tendering regime have been clear for two years, and became impossible to ignore last year. In 2025, the German government held two offshore wind tender rounds.
In the first, in June 2025, the Federal Network Agency secured only two bids for the rights to build a 1.2GW project on the N-9.4 site. TotalEnergies subsidiary Offshore Wind One GmbH won that tender, but the lack of bids from interested developers was a major cause for concern.
The German government followed that tender in August 2025 by seeking developers for two sites, N-10.1 and N-10.2, with potential capacity of 2.5GW. It attracted no bids.
Industry bodies including WindEurope argued that the failed tender followed long-term issues with the German system that have reduced the number of interested developers. These include the system’s reliance on uncapped negative bidding, which forces companies to pay high sums for the right to develop offshore wind farms. This is a legacy of the early 2020s when project profit margins were higher and competition for sites was intense.
In addition, the system has offered companies no form of revenue stabilisation, increasing their risk exposure.
This 2025 failure meant Germany faced renewed calls from the industry to move to a system of two-way Contracts for Difference similar to the one used in the UK, but the calls for CfDs go back at least a year before that. In August 2024, Germany successfully awarded development rights for three projects totalling 5.5GW in an offshore wind tender but, even then, the government only secured five bids across the three sites. That was a major warning sign ahead of last year’s problems, and raises a question of when the government will finally bring in the much-needed reforms.
The main reason it has taken so long for the German government to implement reforms is simple: it takes time to come up with proposals that address problems rather than make them worse.
Germany’s Federal Maritime & Hydrographic Agency published proposed reforms to the 2025 Offshore Site Development Plan in January 2026, and revealed updated proposals last month. Those proposals were out for industry consultation, which closed on Monday (20th July), and official legislative progress can only be made after the parliament returns from its summer recess on 7th September.
Those proposed changes include amendments to the country’s offshore wind tendering schedule, including new boundaries for some offshore wind sites; changes to offshore electrical transmission routes; and rules to optimise the layout of projects to reduce the density of turbines, eliminate wake effects, and improve the economics of projects. This is in addition adopting CfDs.
However, these changes does not tackle the need for further investment in ports and the supply chain.
The German Association of Energy & Water Industries has this month renewed its calls for the reforms to happen quickly so fresh offshore wind tenders can happen in 2027.
Another reason proposed changes have been slow to emerge is that the challenges in German offshore wind have been shifting. For example, in May, energy giant TotalEnergies revealed it plans to pull out of some of its 8.5GW of offshore wind assets in Germany. The company said it is looking to hand back development rights for the 1.5GW Nordsee Energies 2 project on the N-11.2 site, due to rising costs, changing market conditions and uncertainty on grid connections. It said this follows a strategic review into its offshore wind portfolio and other project exits in Germany are likely to follow. TotalEnergies has also exited the US market this year.
The German government has refused to allow TotalEnergies to hand back the rights, because it argues that the contract is legally binding. In practice, it cannot compel any firm to build an offshore wind farm, and the German Offshore Wind Energy Association has proposed that the government should introduce a measure to enable developers to voluntarily hand back leases won between 2023 and 2025 so the areas could quickly be re-tendered in 2027 under any incoming CfD regime. That could avoid the threat of sites being left idle by developers that refuse to build but cannot get out of their contracts.
TotalEnergies is not the only company looking to exit German offshore wind projects. Its fellow oil giant BP is reportedly looking to exit the 4GW Oceanbeat complex planned in the North Sea, where it won the rights in 2023 and which it is developing via its JERA Nex BP joint venture. This is of little surprise given that BP announced in early 2025 it was cutting back its renewables investments to focus on growing oil and gas production.
But there is positive news in Germany too. The exit of oil and gas giants may be a worry for policymakers, but there has been no suggestion thus far that utilities such as EnBW, Iberdrola, Ørsted and RWE will follow them out.
The country is unlikely to hit its goal of 30GW of installed offshore wind by 2030, with those in the industry suggesting it will conclude the decade nearer 20GW, but it is still attractive to experienced developers. Germany’s challenge is to boost its appeal for investors and developers when new rules come into force, which could happen by the end of 2026.
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