O2 Telefonica has agreed to buy power from Iberdrola's Baltic Eagle offshore wind farm for 15 years. It is the fifth company to sign up for output from the same 476 MW project. The contract is small. The list it joins is the interesting part.
Key takeaways
- Iberdrola signed a 15-year power purchase agreement with O2 Telefonica in February 2024 for 50.1 MW from the Baltic Eagle offshore wind farm in the German Baltic Sea, supplying 3,000 GWh in total from 2025, or about 200 GWh a year.
- O2 Telefonica will use the Baltic Eagle power to supply about 8,000 of its 28,000 mobile phone stations in Germany, roughly 29 percent of its network.
- Baltic Eagle is a 476 MW offshore wind farm north of the island of Rugen, built with 50 Vestas turbines of 9.525 MW each, and expected to generate 1.9 TWh a year; Masdar acquired a 49 percent stake in July 2023.
- Before O2 Telefonica, Iberdrola had signed Baltic Eagle power purchase agreements with Salzgitter for 114 MW, Holcim for 62.63 MW and Stahl-Holding-Saar for 50 MW, all for 15 years, plus a 303 MW contract with Amazon spanning Baltic Eagle and Windanker.
- Enerdatics records 27 German offshore wind power purchase agreements announced in 2023 and 2024, of which only two disclose a tariff, while 11 of the 27 run for 15 years.
How much of Baltic Eagle is now sold?
At least 58 percent, and probably more. The four contracts that name Baltic Eagle alone add up to 276.73 MW: Salzgitter, Holcim, Stahl-Holding-Saar and now O2 Telefonica. That is 58 percent of the farm's 476 MW before Amazon is counted.
Amazon is the complication. Its 303 MW contract covers Baltic Eagle and Windanker together, and the split between the two farms is not disclosed. Windanker is a planned 300 MW farm in the same area. If even a modest share of Amazon's volume sits on Baltic Eagle, Iberdrola has contracted most of the project with five corporate buyers. That is the difference between a project whose revenue rests on signed contracts and one whose revenue rests on power price forecasts.
Why does a telecoms network want 15 years of offshore wind?
Because a mobile network's demand looks a lot like an offshore wind farm's supply profile in one respect: it never switches off. Base stations draw power around the clock, every day of the year, with little seasonal swing. A steelmaker can schedule an electric arc furnace. A telecoms operator cannot schedule its network.
The contract volume fits that load. Spread over 15 years, 3,000 GWh is 200 GWh a year, which on 50.1 MW implies about 3,990 full-load hours, the same yield the developer expects from the whole farm. O2 Telefonica is buying a straight slice of Baltic Eagle's output and pointing it at roughly 29 percent of its base stations. A 15-year term fixes where that slice of the network's power comes from until 2040.
It is also not O2 Telefonica's first German offshore wind contract. In January 2023 Telefonica was one of 11 offtakers in a 320 MW, 10-year contract with RWE for the Nordsee Ost and Amrumbank West wind farms. Moving from a pooled 10-year deal to a dedicated 15-year one is a step up in both volume certainty and commitment.
What does Iberdrola gain from so many small buyers?
Diversification of credit risk, and an easier financing case. A power purchase agreement is only as good as the buyer standing behind it. Five buyers from steel, cement, ecommerce and telecoms spread that risk across sectors that do not move together. The pattern repeats across Iberdrola's Baltic Sea hub, which pairs Baltic Eagle with the 350 MW Wikinger farm and the planned 300 MW Windanker.
Taken together, the hub adds up to about 1,126 MW, and the buyers overlap. Amazon's contract already straddles two of the three farms, and Mercedes-Benz signed for 140 MW from Windanker in March 2023. Selling output from several neighbouring farms to one roster of customers can let Iberdrola balance volume between projects as each comes online, and gives buyers a single counterparty for a growing share of their German demand.
It also explains the price Masdar paid. Masdar's 49 percent stake in Baltic Eagle was bought into a project that already had a large share of its output contracted with industrial buyers. Every further contract firms up the cash flow behind that valuation.
Enerdatics' data shows 27 German offshore wind power purchase agreements announced across 2023 and 2024. Only two carry a disclosed tariff, both on the Butendiek farm: $46.23 per MWh for BKW Energie and $230 per MWh on a 6.5-year Greencoat contract signed in October 2023. Eleven of the 27 run for 15 years, the term used by Iberdrola on Baltic Eagle and by EnBW on He Dreiht. Five run for 10 years, the term RWE used on Kaskasi and on Nordsee Ost and Amrumbank West. Duration is disclosed far more often than price, so it is the clearest signal of how sellers are structuring these contracts.
What does the deal signal for German offshore wind PPAs?
That the buyer pool has moved well past heavy industry, and the term has settled at two lengths. Steelmakers still dominate Baltic Eagle's list: Salzgitter, whose wider set of renewable power contracts includes its 114 MW Baltic Eagle deal, and Stahl-Holding-Saar. But Amazon and O2 Telefonica are digital businesses with flat, continuous load. For them, 15 years of offshore wind is a procurement decision rather than a decarbonisation project.
The split between sellers is the other signal. Iberdrola and EnBW sign for 15 years. RWE has preferred ten, as the sequence of Kaskasi contracts shows. The longer term suits a developer that wants contracted revenue to finance construction. The shorter may suit a seller that would rather reprice sooner. Buyers like O2 Telefonica, which have now signed both, are choosing between those two bets.
Frequently asked questions
How much power will O2 Telefonica buy from Baltic Eagle? A total of 3,000 GWh over 15 years starting in 2025, from 50.1 MW of the wind farm's capacity. That is about 200 GWh a year, enough to run around 8,000 of O2 Telefonica's 28,000 mobile phone stations.
Who else buys power from Baltic Eagle? Iberdrola has signed Baltic Eagle contracts with Salzgitter, Holcim and Stahl-Holding-Saar, all for 15 years, and a 303 MW contract with Amazon that covers both Baltic Eagle and the Windanker wind farm.
Who owns Baltic Eagle? Iberdrola developed the 476 MW wind farm, and Masdar acquired a 49 percent stake in July 2023. Together with Wikinger and the planned Windanker, it forms Iberdrola's Baltic offshore wind hub.
Ready to get deal-ready answers in seconds? Try Enerdatics Leap AI and access verified intelligence across M&A, financings, PPAs, projects, and energy market developments through natural language.
.jpeg)
