The Ministry of Energy proposes to temporarily suspend the tender for a second strategic 700 megawatt (MW) wind farm in the Baltic Sea and to review the terms and conditions of the tender.

According to the ministry, the aim of the review is to set the terms of the current tender in such a way that the project will have the lowest possible impact on consumers' final electricity bills.

A draft government decree to this effect has been submitted to the authorities for coordination. 

If the Cabinet of Ministers decides to reopen the tendering procedures, they would be restarted in accordance with the deadlines and procedures set out in the Law on Renewable Resources. 

According to this procedure, the new tender would have to be organised within 180 calendar days from the date of its publication on the VERT website: the registration of the participants would take 90 days, and the Council would have to determine the winner within another 60 days, with the possibility of extending the deadline by a further 30 days.

Earlier, Energy Minister Žygimantas Vaičiūnas had already announced that the review of the tender conditions would be carried out by his ministry within a month. 

Several options have been considered: to continue the current tender without any changes, or to stop it altogether, or to make corrections to the existing auction conditions, as has been decided now.

The Seimas Audit Committee and the Energy and Sustainable Development Commission have also proposed to suspend the second wind farm tender until a proper cost-benefit analysis has been carried out.

The Seimas simplified the conditions for the second auction – it allowed one company to win the auction, and set a 15-year state incentive period, whereby if the market price of electricity is lower, the state would pay the difference to the investor, and if the market price is higher, the developer would pay back the difference. This state support is subject to coordination with the European Commission (EC).

As ELTA reported, the State Energy Regulatory Council (SERC) re-launched the second wind farm tender on 18 November last year.

The terms of the tender include a range of electricity sales prices between EUR 75 and EUR 125 per megawatt-hour (MWh).

The second tender would allow bidders to propose an offshore development fee to the State of at least €5 million, with each bidder having to propose in real time a development fee at least an amount higher than the one proposed before.

The potential winner of the second tender was previously expected to be announced in the second half of April, after which it would be evaluated by the government's Coordination Commission for the Protection of Objects of National Security Significance (CSPNS) within a period of up to 60 calendar days.

As previously announced, two wind farms in the Baltic Sea could provide around half of Lithuania's total electricity needs.

The state-owned energy group „Ignitis“ has already said it will take part in the second auction, and the Polish oil group „Orlen“ is also considering it.

The European Union (EU) has set a target for Member States to have at least 60 GW of total installed capacity of offshore wind farms by 2030 and 300 GW by 2050.

As foreseen in the National Energy Independence Strategy (NENS) adopted by the Seimas, two offshore wind farms with a combined capacity of 1.4 MW (megawatts) are planned to be installed in Lithuania by 2030, and the capacity of wind farms is to increase to 4.5 GW (gigawatts) by 2050.