What’s in this news?
The European Commission has approved a €5 billion Danish State aid scheme to support offshore wind development. Covering the Hesselø and North Sea I Mid projects, the scheme is expected to play a key role in achieving the EU’s 2030 renewable energy targets and accelerating the transition to a net-zero economy.
The European Commission has approved a €5 billion (DKK 37.6 billion) Danish State aid scheme aimed at supporting offshore wind energy deployment.
The measure aligns with the objectives of the Clean Industrial Deal and is designed to contribute to the EU’s 2030 renewable energy targets.
Two offshore wind projects to be supported
The scheme will support the development of two major offshore wind farms:
- Hesselø Offshore Wind Farm
- Minimum capacity: 0.8 GW
- Expected annual generation: ~3.2 TWh
- North Sea I Mid Offshore Wind Farm
- Minimum capacity: 1 GW
- Expected annual generation: ~4.6 TWh
Combined, these projects are expected to generate electricity equivalent to approximately 25% of Denmark’s annual electricity production.
Two-way CfD mechanism
The support will be granted through a two-way Contract for Difference (CfD) mechanism:
- Producers receive payments when market prices fall below the strike price
- Producers pay back when market prices exceed the strike price
This design ensures both investor certainty and proper market functioning.
20-year support period
The scheme will run for 20 years and will be allocated via a competitive bidding process. Support will be based on potential generation capacity rather than actual production.
Supporting EU energy transition
The Commission concluded that the scheme is:
- Necessary and proportionate
- Supportive of the net-zero transition
- Effective in reducing fossil fuel dependency
and compliant with EU State aid rules.
