New winds ahead: Germany’s overhaul of its offshore wind regime

On 2 September 2026, the German Federal Cabinet has adopted an amendment to the Offshore Wind Energy Act (Windenergie-auf-See-Gesetz, WindSeeG) and related provisions. The draft marks a significant recalibration of the framework that has governed the build-out of German offshore wind in recent years. The shift comes at a pivotal moment for Germany’s offshore wind industry: No bids were submitted in an offshore tender in August 2025, tenders were suspended for 2026 and postponed until 2027, and the future of projects that have already been awarded for is unclear. Germany nevertheless remains committed to its target of 70 GW offshore wind capacity by 2045. The bill has been declared particularly urgent (besonders eilbedürftig) and is therefore expected to enter into force in due course. 

The overarching ambition is to secure the offshore expansion path while lowering costs and increasing resilience: The draft seeks to reduce system costs by synchronising generation and grid build-out, create a more reliable investment environment, and implement resilience and security requirements of the European Union’s Net-Zero Industry Act (NZIA, Regulation (EU) 2024/1735). 

Below are our key takeaways for developers, investors and grid operators:

1.  From “zero-cent” auctions towards a two-stage procedure with a CfD safeguard

The draft introduces a two-stage bidding procedure for both non-investigated and centrally pre-investigated sites. In stage 1, sites are auctioned on a market basis without subsidies. If there is more than one bidder, a dynamic bidding procedure with round prices starting at EUR 0/MW is employed. Only if no stage 1-bid is received does the process move to stage 2, which uses a Contract for Difference (CfD) based support mechanism with a market premium and a refinancing contribution. The stage-2 CfD runs as a dynamic descending-price procedure subject to a cap (Höchstwert): Competitive bidding drives the price down, but a single bidder is awarded at the highest value. There is a cap of 9.487 ct/kWh for non-investigated and 9.6715 ct/kWh for centrally pre-investigated sites. The Federal Network Agency (Bundesnetzagentur) can adjust it for an individual site by up to 35 per cent.

The design deliberately prioritises subsidy-free, market-based realisation and reserves state support only for cases where the mechanism fails. The stage-2 procedure is expressly aligned with the market premium and refinancing-contribution mechanisms under the German Renewable Energy Act (Erneuerbare-Energien-Gesetz - EEG), including revenue clawback in high-price periods. This is a marked shift away from the negative-bidding dynamic that characterised recent German offshore auctions, and it should be read as an attempt to take the pressure off developer balance sheets while limiting the burden on grid customers and the federal budget. A successful bidder may opt out of the CfD once during the first ten years and switch to a PPA, but awards cannot be handed back unilaterally.  

2.  Cyber- and data security: A must-have

Under the NZIA, cyber- and data security are established as a mandatory pre-qualification criterion for all offshore tenders. Bidders must meet the requirements for IT security under the Energy Industry Act (Energiewirtschaftsgesetz, EnWG). Only entities established in the European Economic Area (EEA) may exercise operational control over the wind farm, and all auction, construction and operational data must be stored within the EEA. This is as much an exercise in data sovereignty as it is in security: Operational control and data will be kept within the EEA. Non-compliant bids will be excluded at the pre-qualification stage, as compliance is a mandatory eligibility requirement. 

3.  Resilience to replace qualitative criteria catalogue 

The draft replaces the previous qualitative / non-price award criteria (contribution to decarbonisation, extent of direct energy supply, noise pollution, foundation technology, contribution to skilled labour) for centrally pre-investigated sites with resilience and sustainability criteria mandated by the NZIA. As such, the applicability of said criteria is largely dependent on findings by the European Commission on supply concentration: For centrally pre-investigated sites, a resilience pre-qualification can, dependent on findings by the European Commission, prohibit sourcing turbines and critical components from a single third-country company if its market share has surpassed 50 per cent in the EU or its market share has risen by at least 10 percentage points over two years to reach at least 40 per cent. Absent of any such European Commission finding, a statutory backstop applies, capping the share of turbines and key components from the People’s Republic of China at 75 per cent. Separately, resilience for permanent magnets and limiting the CO2 footprint (as a sustainability criterion) are turned into optional evaluation criteria. Such voluntary commitments earn a multiplicative bid advantage. The draft law also contains a signal to the supply chain: the permanent-magnet resilience criterion may migrate from an evaluation to a pre-qualification requirement by 2030. 

4.  Boosting economic viability: Longer operating lives, more flexible volumes meet higher deposits

To increase planning certainty for investors, the standard operating period is extended from 25 to 35 years, with a possible one-off extension of up to five further years. This does not apply retroactively: Projects based on awards from the 2023 to 2025 tenders remain subject to the 25-year term. The prolongation is aimed at allowing for the spread of capital costs over a materially longer production horizon, enabling project developers to make technically and economically optimal investments. The fixed 4,000 MW annual tender standard gives way to a flexible corridor of 2,000 – 4,800 MW from 2027 onwards, giving the authorities room to smooth out the further expansion path and accommodate cross-border cooperation. It also takes into consideration that an annual average of approx. 3,000 MW of additional offshore capacity is necessary to reach the 70 GW capacity goal by 2045. The bill also caps lot sizes: As a rule, 1,000 to 1,200 MW per site, with 500 to 2,400 MW only in exceptional cases. Security deposit requirements are being raised, rising to EUR 200/kW for non-investigated and EUR 250/kW for centrally pre-investigated sites, due to rising project costs. The revision also introduces a dynamic security deposit element for stage-1 awards, a reminder that greater flexibility comes with greater commitment. 

5.  System-cost optimisation: Overbuild, Central Monitoring and the end of 2K

Perhaps less headline-grabbing but all the more economically significant are the measures targeted at the cost of the offshore system as a whole. The draft allows for “overbuilding” (Überbauung) of transmission capacity to optimise network utilisation and introduces a centralised environmental impact assessment coordinated by the Federal Maritime and Hydrographic Agency (Bundesamt für Seeschifffahrt und Hydrographie, BSH) from 1 July 2028 onwards, replacing the current project-by-project model and eliminating the overlapping assessment and resource bottlenecks it has produced. Additionally, removing the 2 Kelvin-cable temperature-criterion (2K-criterion) from the EnWG will allow for increased transmission capacity. In turn, this is meant to reduce the need for offshore grid connection systems. Overall, the changes are intended to improve efficiency, lower per-MW system costs and, ultimately, the offshore grid surcharge borne by grid customers. Developers also gain on delay risk: Under a new rule in the German Energy Industry Act (EnWG) compensation for a delayed grid connection can be claimed from the 31st day after the agreed completion date, rather than from the 91st day as today. 

6.  A careful regulatory go for hybrid wind-hydrogen projects

The draft also creates a regulatory basis for the combined grid connection of wind installations to the grid as well as to upcoming hydrogen infrastructure (hybrid connection). The roll-out of hydrogen has proven to be an ambitious undertaking which is presented with additional technical challenges at sea. The regulatory change opens up “other generation areas” (sonstige Energiegewinnungsbereiche) for grid connection to enable coupled wind-to-hydrogen pilot projects. This remains a pilot-only, de-minimis regime, limited by a 2.5 per cent installed-capacity threshold. It is a cautious but noteworthy first step towards offshore electrolysis at scale.

Next steps

The CfD-provisions are subject to state-aid approval by the European Commission as are parts of the WindSeeG itself. Additionally, several resilience triggers depend on the European Commission’s own findings on supply concentration, so the practical impact of the new criteria will be determined at EU level. 

The draft expects the first CfD-funded projects to come online from 2032 onwards. For developers weighing whether to bid in the first tender under the new regime in 2027, the immediate task is to prepare for a fundamentally different risk allocation: Subsidy-free market realisation as a default setting, a CfD backstop where no stage 1 bid is received, and a set of cyber and resilience requirements that will need to be adhered to long before financial close. We will be monitoring further developments closely and are ready to advise on what these changes mean for your project.

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