RWE Sees Climate Goals at Risk as Global Wind Power in Crisis

Source: By Petra Sorge, Bloomberg • Posted: Thursday, August 10, 2023

Progress on protecting the climate could be at stake if the difficulties facing the offshore wind industry persist, RWE AG’s head Markus Krebber said.

In recent weeks, projects under development in the UK and the USAhave been halted on soaring costs, even as demand for renewable energy soars. Krebber called it a “challenging phase,” and said inflation and strained supply chains are causing prices for offshore turbines to rise significantly.

“It is the worst case scenario for the energy transition if large projects that have already been awarded are not realized as planned, which quickly calls into question the achievement of climate protection targets,” the chief executive officer said in a call with journalists on Thursday. He added that German energy company RWE will implement its own offshore projects as planned.

Krebber urged suppliers to expand capacity, and also said that countries should design auctions with longer lead times than five years in order to help long-term supply chain security.

Last month, oil majors BP Plc and TotalEnergies SE were the winners of Germany’s biggest ever offshore wind auction after offering a joint €12.6 billion ($13.9 billion). RWE — which increased earnings in its offshore wind segment by one fifth to €762 million in the first half of the year — also participated without success. That’s “because price bids had reached a level that, according to our criteria, was no longer compatible with the economic viability of the projects,” Krebber explained.