Pexapark, a provider of energy trading solutions, has teamed up with NextWind, an independent green power producer (IPP), to develop a trading strategy for its wind farm portfolio in Germany. The partnership is aimed at securing stable revenue streams for NextWind's wind farms in the run-up to their planned repowering.
NextWind has successfully obtained separate route-to-market (RTM) and hedge contracts for a 200MW wind farm portfolio located across Germany. The agreement comes as these wind farms, which have been operational for 20 years, reach the end of their regulatory life under the Erneuerbare Energien Gesetz (EEG) subsidy scheme.
The new contracts are designed to help NextWind manage the risks associated with merchant power prices during the period between the expiry of the EEG subsidy and the full repowering of the wind farms, which is expected to occur between 2026 and 2027.
NextWind's repowering efforts are part of a broader initiative to rejuvenate Germany's aging wind infrastructure. Through the repowering process, the company plans to increase the total capacity of the wind farms by as much as three times, while capitalizing on favorable local wind conditions and existing grid connections.
The rise of repowering and lifetime extension projects across Europe has underscored the need for innovative approaches to bring aging, post-subsidy assets into the next phase of commercial operation. Despite the increasing number of such projects, there is still limited success in completing these initiatives.
Pexapark's portfolio trading services team played a crucial role in assisting NextWind by identifying a novel approach that optimizes project revenues and leveraging advanced software tools to accelerate the tendering process.
Jens Hollstein, EVP Advisory at Pexapark, explained: “In the German market, both RTM and hedging needs are usually fulfilled through a single contract with the offtaker who offers the most attractive balancing agreement – but this is a compromise that can often result in an unfavorable hedging price. By separating these contracts, we were able to secure the most attractive balancing contract with one offtaker and the most attractive hedging contract with a second. That ultimately resulted in an uplift of between €10 and €15/MWh, compared to a single agreement – significantly enhancing the value NextWind can deliver from the wind farms.
NextWind's Co-CEO and Co-Founder, Werner Suss, emphasized the importance of innovative trading strategies in their efforts to revitalize Germany's wind sector: “Innovative, data-driven trading strategies are integral to NextWind's mission to give Germany's wind infrastructure a new lease of life. We were delighted to work with Pexapark to secure ongoing revenues for this project, laying the groundwork for our upcoming repowering plans and helping to create as much value as possible for our investors and local communities.
This collaboration is a significant step toward ensuring the continued success of NextWind's wind farm projects and advancing Germany's renewable energy goals.
