‘We fear stagnation, not acceleration’ for offshore wind’s future, says Ørsted’s Ulrik Stridbæk

This article is part of our special report Scaling wind power, navigating Europe’s green transition and competitiveness.

Offshore wind has been central to Europe’s clean energy ambitions, but the sector is at risk of stalling because of rising costs, failed auctions and political uncertainty. Developers are warning of a looming investment crisis.

In a new report, Offshore Wind at a Crossroads, Ørsted outlines the structural problems holding back the industry, and what must change. Ulrik Stridbæk, the company’s Head of Global Regulatory and Public Affairs, explains what’s gone wrong, and what policymakers must do to get offshore wind and Europe’s industry back on track.

NV: Why do energy systems in Europe need to change?

Ulrik: If we are to decarbonise our energy system towards 2050, which we will do for multiple reasons - to save the climate, to get independence from imported fossil fuels and for security and control - we will need to electrify. So, shifting a lot of economic activity from dumb cars and dumb burning of fossil fuels into electrical solutions [is necessary].

NV: Why is offshore wind such a key part of the energy transition?

Ulrik: If we are to do that, we will have to at least double the electricity supply by 2050. At least. And if we are to do that, we need offshore wind. You do not have a choice. There is such a demand, we will need all renewable energy solutions. Offshore wind plays a big role, since it can deliver green power at scale.

If we don’t make it work for offshore wind, Europe has a problem. A real serious problem down the line. We will not be able to electrify Europe. It’s not just our assessment, this is what any analysis says.

NV: Why did you create the new report ‘Offshore wind at a crossroads’? 

Ulrik: To try to do something a little bit different. Let’s bring the facts to the table and sit across that table rather than just throwing positions and asks at each other. These are not times to solve everything perfectly, we must act head-on. We don’t have time for perfection.

NV: What are the main points and asks in the report? 

Ulrik: The number one thing to do is to get enough volume into the market that we can rely on, that will get built. The way to do that, in our view, is to de-risk these projects. And the most common tool used to de-risk projects is contracts for difference (CFDs).

We say to governments: make viable CFD auctions for projects to be delivered from 2031 to 2040, 10 gigawatts roughly per year at least. That’s the no-regret number. Then you’re on track for the low-end 2050 target. On top of that, there should be a pathway to auction off further capacity, another five-ish per year, on the back of corporate PPAs.

The second big ask is coordination. Countries need to coordinate, today’s project pipeline is uneven, and the supply chain can’t scale up overnight.

NV: Your report talks about a “vicious cycle” in offshore wind. What does that mean?

Ulrik: The vicious cycle is the combination of cost increases, uncertainty, supply chain bottlenecks, and high concession payments. That triggers even more uncertainty, and instead of accelerating investments in the supply chain, we’re almost decelerating.

Many investors, ourselves included, are reducing our investment targets. Holding back. The sector is struggling to attract capital. Rates of returns are decreasing. That’s the vicious cycle. And we claim that you can spin that with the CFD. Turn it into a virtuous cycle.

NV: What’s the one thing that needs to change most urgently? 

Ulrik: The most urgent fix is to get back to a system that enables projects to get built. CFDs are the most common tool to do that. They’ve worked in the UK, in Poland, in France. You could call it a modern CFD, that is well-designed and viable, but it works.

NV: High energy prices are hurting Europe’s industry. Can offshore wind bring prices down? 

Ulrik: We believe analytically that we can see cost reductions again. We say 30% by 2040 compared to a merchant project invested in today. Half of that comes from reducing risk via CFDs, lowering the cost of capital. The other half comes from learning curves: more volume, more competition, more efficiency.

That’s why Europe must be cost effective, to make our products competitive. If we can turn this around, investment would start to flow again. That helps industry, energy users, and Europe’s economy overall.

NV: How do tripartite agreements fit into the EU’s vision for a Clean Industrial Deal, and what do they mean for offshore wind? 

Ulrik: The tripartite approach, governments, industry and the supply chain, was a clear message at WindEurope. But the missing party in that equation is the most important: the end-user. This must be about delivering clean, reliable and affordable power, whether for households or industries shifting to electrification. That’s what Europe’s energy transition depends on.

Jacek Truszczynski from DG GROW said it clearly: this is part of the Clean Industrial Deal. Ditte Juul Jørgensen framed it as building on the Wind Power Action Plan, not just pledges, but real alignment on timelines, tenders and investments.

That’s what’s missing: overambitious pipelines in 2030–32, but little before or after. Tripartite agreements could help smooth that out, boost supply chain confidence, and give governments more control over delivery.

This kind of predictable environment is exactly what we need. This kind of predictable environment keeps energy affordable, supports investment, and strengthens Europe’s competitiveness, through scale, innovation and certainty.

NV: What’s your closing message to EU policymakers who see offshore wind as important, but not urgent?

Ulrik: We fear we’re heading toward stagnation rather than acceleration, not out of blame, but due to coinciding circumstances. Yet there’s a clear path forward: a shared willingness from policymakers, industry and the supply chain to focus on solutions.

Ultimately, this is about the customer, the people and industries that need clean electricity to move, build and grow. Offshore wind must deliver for them. That mindset of shared responsibility is what will get Europe back on track.

[Edited By Brian Maguire | Euractiv's Advocacy Lab ]