1.8GW Offshore Wind Bidding Announced for First Half...Will It Succeed This Time?

Competitive Bidding Announced for First Half of 2026

1,400 MW Fixed and 400 MW Floating Offshore Wind Capacity

Preliminary Military Operational Consultations for 10 Projects

Project Risks Addressed, High Interest Expected

Low Price Ceiling Makes Profitability Key

Overview of Nakwol Offshore Wind Farm

The Ministry of Climate, Energy and Environment announced on March 30, 2026, that it will conduct a fixed-price contract competitive bidding for 1,400 MW of fixed offshore wind power and 400 MW of floating offshore wind power in the first half of the year. The total scale is 1,800 MW (1.8 GW). Of the fixed offshore wind capacity, approximately 1,000 MW will be available for general bidding, with around 400 MW allocated for public-led bids.

Renewable energy power producers selected through the fixed-price contract competitive bidding will be able to sign supply contracts at a fixed price for 20 years with obligated suppliers under the Renewable Portfolio Standard (RPS). Typically, fixed offshore wind power requires an investment of at least 6 billion won per MW, while floating offshore wind power requires at least 8 billion won per MW. If all the bidding capacity is awarded and the projects proceed smoothly, this would create a new market worth over 12 trillion won.

The ministry explained that the bidding volume was determined to ensure a valid level of competition, based on a preliminary assessment of market demand. The government expects the offshore wind bidding in the first half of the year to achieve a competition rate of at least 2 to 1.

Notably, for this bidding round, the government conducted preliminary military operational compatibility consultations with 10 projects intending to participate. As the project risks have been addressed, it is expected that more companies will take part in the bidding. If a project without prior military consultation is selected, it must undergo the military operational compatibility consultation before proceeding.

Since the government plans to abolish the RPS system in the future, it is anticipated that many developers who have been preparing offshore wind projects will participate in the bids. According to industry sources, there are more than 10 projects that have completed environmental impact assessments and are preparing for offshore wind bidding.

This offshore wind power competitive bidding is being held for the first time in a year since the first half of last year, resulting in a significant number of projects awaiting the process. At that time, no winner was selected in the general bidding, and only public-led projects were awarded. In the second half of last year, competitive bidding was conducted exclusively for onshore wind power.

There are concerns that the price ceiling set by the government is lower than the expectations of developers, making it difficult to ensure profitability. If project profitability is low, it becomes challenging to secure financing, which can hinder project progress.

The bid ceiling for fixed offshore wind power has been set at 171.229 won per kWh, while for floating offshore wind power it is set at 175.100 won per kWh. This represents a decrease of 3.02% and 0.83%, respectively, compared to last year's ceiling prices. The ministry explained that it considered global trends in the Levelized Cost of Energy (LCOE) for offshore wind, capital expenditure (CAPEX) fluctuations, and other market conditions.

The public-led bidding market established last year will continue to operate under the same conditions this year. Public-led offshore wind projects refer to projects in which public institutions and local public enterprises hold a majority stake.

There is also interest in whether a floating offshore wind power developer will emerge for the first time in two years. In December 2024, the Firefly Offshore Wind project was selected as the first floating offshore wind developer in Korea, but the project was abandoned after failing to sign a contract for the purchase of Renewable Energy Certificates (REC).

This year, the government has decided to apply a separate bid ceiling for floating offshore wind power, distinct from fixed offshore wind. This reflects the different site conditions, technical levels, and supply chain situations between the two types. However, since the ceiling price presented by the government is lower than what developers anticipated, there is significant deliberation about whether to participate in the bidding.

With the Offshore Wind Power Special Act taking effect on March 26, the ministry plans to announce a mid- to long-term offshore wind competitive bidding roadmap during the first half of the year. Another offshore wind bidding round is scheduled for the second half of the year. The government will begin accepting requests for military operational compatibility consultations from April for projects intending to participate in the second half bidding round.

Further details on this year’s bidding can be found in the official notice posted on the Korea Energy Agency website.

This content was produced with the assistance of AI translation services.