Tuesday, November 29, 2022
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Major update on ČEZ Group’s Datteln wind farm project

ČEZ Group’s Datteln project received operating support of 58.7 euro/MWh in a German auction of onshore wind power plants. Depending on the correction factor used, this will secure a 78 euro/MWh tariff for 20 years, upon connection.

This provides a key opportunity for ČEZ to gain further experience in the preparation of wind projects, which it can apply in the Czech Republic. At the same time, it will support the European power supply security which is independent of Russia.

Early next year, construction will commence on the “onshore” wind farm, which will have a capacity of 11.4 MW. It is expected that the wind park will be ready to connect to the network at the end of 2023.

The wind farm, situated north of Dortmund in the state of North Rhine-Westphalia, will comprise two turbines with a rotor diameter of 149 m placed atop 164-metre-tall towers. The financing for the project was secured at favourable terms via a German bank. The wind farm’s production will cover the annual consumption of some 6,000 households.

“The fact that we have succeeded in the very first auction for which we signed up with the project represents a clear success for our small Czech-German team. The price tendered, at the level of the upper auction limit, is competitive, which ensures that the project will be profitable”, said Jan Kalina, Member of ČEZ’s Management Board and head of the Renewable and Classic Energy Division.

Several conditions had to be met to qualify for the auction: the projects must have a building permit in place, including an environmental impact assessment (EIA), and the specific parameters of the turbines must be clear – i.e., including their type and manufacturer. The minimum guaranteed production price tendered is further adjusted with a correction factor, which differs based on the wind potential of the building site.

“To put it in simple terms, we could say that a lower correction factor is used for projects that are close to the sea – the worse the locale in terms of windiness, the higher the operating support. The objective of the system in an ideal-case scenario is to ensure an even distribution of wind power plants across Germany”, added Mr Kalina.

The price tendered fluctuated between 47.7 and 58.8 euro/MWh. According to the German agency Bundesnetzagentur, a total of 116 bids were submitted, with an aggregate capacity of 947 MW. Two of the bids were eliminated by the regulator due to formal errors, with support granted to 114 projects, with an aggregate capacity of 931 MW.

The Datteln wind project is the first wind farm prepared in cooperation with the German developer GP Joule, which develops wind projects to the Ready to Build (RtB) stage. ČEZ finances the external costs of the development and the auction security and negotiates agreements for the supply of the turbines and their long-term servicing. As the RtB status is achieved by each of the projects, ČEZ has a buy option to purchase the projects from the joint venture, which now comprises a total of 8 projects at a medium-advanced state across several German states. Due to farm design optimisation, the planned capacity of the portfolio currently stands at 141 MW.

ČEZ Group is a major leading economic entity in the Czech Republic, operating in Western, Central, and South-Eastern Europe. ČEZ’s main business operations include generation, distribution, trading, and sale of electricity and heat; trading and sale of natural gas; provision of comprehensive energy services from the new energy sector, and coal mining.  CEZ Group is one of the ten largest energy companies in Europe, with more than 3.5 million customers and about 28,000 employees.

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