Portugal to speed up first offshore wind auction amid strong investor interest

View of a hybrid power park with solar panels and wind turbines in Sabugal

By Sergio Goncalves

LISBON (Reuters) - Portugal's first offshore wind power auction is drawing interest from large utility companies, especially those in northern Europe, the economy minister said on Friday, adding that the government would speed up the process aiming for a third quarter launch.

The government last week launched a public hearing regarding proposals for the delimitation of areas off the country's Atlantic coast where wind farms can be built, targeting 10 gigawatts of installed wind capacity by 2030.

Economy Minister Antonio Costa e Silva said Portugal's powerful and durable offshore wind potential appealed to large international companies.

"We are seeing great interest from these international companies, especially from German companies, Denmark and other Nordic nations," Costa e Silva told a news conference.

"We are going to speed up the process and want to launch the auction in the third quarter," he said, adding that the capacity to be offered was yet to be decided.

He said the government is talking to the interested companies and that some of them, like Germany's BayWa, were keen to move quickly.

BayWa in October said it wanted to install the first subsidy-free commercial floating offshore wind project off the Portuguese coast, with 30 turbines and up to 600 megawatts of capacity.

Floating wind technology, seen as the final frontier in the offshore wind industry, has gained traction in countries such as Britain, France and parts of southeast Asia.

Costa e Silva said companies operating in the utilities sector are looking for countries with cheaper energy costs.

"We think that wind and solar energy prices are already very competitive and, with all the potential that exists in offshore wind, we may have one more competitive advantage here," he said.

Portugal aims to generate 80% of its annual electricity usage from renewable sources by 2026, up from around 60% in 2022, which was already one of the highest ratios in Europe.

(Reporting by Sergio Goncalves; editing by Andrei Khalip, Kirsten Donovan)