EU Approves €2.08 Billion for Offshore Wind Energy Project in France

The European Commission has approved a EUR 2.08 billion French measure to support offshore wind energy production in France. The decision has been taken under EU State aid rules. The measure will contribute to achieving France’s energy and environmental targets, as well as the objectives relating to the EU’s Offshore Renewable Energy Strategy and the European Green Deal.

Measure For France

France notified to the Commission its intention to support the construction and the operation of a floating offshore wind farm in the sea off the coast of the South of Brittany.  The aid measure, which will run for a period of 20 years starting of the operation of the wind energy farm in 2028, will have a total maximum budget of EUR 2.08 billion.

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Floating offshore wind technology is at an initial stage in France. The floating offshore wind energy farm supported by EU will be the first commercial project of this kind in France.

The wind energy farm is expected to have a capacity of 230 to 270 MW, and to generate 1 TWh of renewable electricity per year for a period of 35 years.

The Commission said that beneficiary of this measure for wind energy project will be selected through a transparent and non-discriminatory bidding process, where bidders will compete mainly on the basis of the amount of aid per MW of installed capacity. The beneficiary is planned to be designated in the second semester of 2023.

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The aid will be granted in the form of a monthly variable premium under the model of a two-way Contract for Difference. The variable premium will be calculated by comparing a reference price, determined in the tender offer of the beneficiary (“pay as bid”), and the market price for electricity. When the market price is below the reference price, the beneficiary will be entitled to receive payments equal to the difference between the two prices. However, when the market price is above the reference price, the beneficiary will have to pay the difference between the two prices to the French authorities.

The measure will help France expedite its wind energy objectives and meet its target of producing 33% of its energy needs from renewable sources by 2030. The scheme is expected to lead to the reduction of greenhouse gas emissions by 430.000 tonnes of carbon dioxide per year.