The European Commission has approved a €5 billion Danish State aid scheme for the Hesselø and North Sea I Mid offshore wind farms, supporting up to 1.8 GW of new capacity.
The scheme will run for 20 years under the Clean Industrial Deal State Aid Framework and will cover both the construction and operation of the two projects. Together, the wind farms are expected to generate around 7.8 TWh of electricity a year, equal to about 25% of Denmark’s 2025 electricity output.
Hesselø is expected to have a capacity of at least 800 MW and an annual generation of around 3.2 TWh. North Sea I Mid is expected to deliver at least 1 GW and produce about 4.6 TWh per year.
Support will be provided through a capability-based two-way contract for differences. The measure will be awarded through competitive tendering and paid as a monthly variable premium when market prices fall below the bid price. When market prices rise above the bid price, operators will pay the difference back to the Danish authorities.
The Commission said the scheme meets the requirements of the framework. It said the capability-based CfD model avoids overcompensation and ensures producers are not paid during periods of negative market value. The Commission also said the structure is in line with the EU’s updated electricity market design rules.
The Commission concluded that the measure is necessary and proportionate to accelerate Denmark’s offshore wind build-out, support the EU’s clean-energy goals, and strengthen industrial competitiveness under the Clean Industrial Deal.
