Siemens Energy has secured a contract worth over $1.2 billion (€1 billion) to build four high-voltage converters for the Bornholm Energy Island (BEI) project in the Baltic Sea, grid operators 50Hertz Transmission and Energinet announced Thursday.

The project aims to create a central electricity hub on the Danish island of Bornholm to transmit renewable energy to both Denmark and Germany. The contract covers the manufacture, transport, installation, testing, commissioning, and plant design of the converters, with completion planned by the mid-2030s.

BEI, valued at $8.4 billion (€7 billion), encountered delays over cost-sharing for its undersea connections. The project includes a 2 GW cable to a transformer substation in northern Germany and a 1.2 GW cable to the Danish island of Zealand. Despite differing capacities, costs were split equally and required renegotiation.

The European Union will provide $770 million (€645 million) in subsidies to reduce Denmark's investment share, as most electricity generated offshore will flow to Germany. The German government has assumed liability if power transmission is interrupted due to faults or maintenance--a guarantee seen as essential for enabling offshore windfarm tendering and cross-border electricity links.

Stefan Kapferer, CEO of 50Hertz, said the government guarantee is "the precondition for a successful tendering process for the windfarms off Bornholm and for an efficient offshore link between the countries along the North and Baltic Sea littorals."

This project highlights a major advancement in offshore grid technology and cross-border renewable energy integration, positioning Siemens Energy at the forefront of complex converter and transmission solutions.

Source: msn.com