Offshore wind-energy installations in Northern Europe have lost appeal among financiers because of increased costs and difficulties in building and running equipment miles at sea, a German banker said.

Many lenders have stopped providing credit for installations that are anchored to the ocean floor, said Thiess Harder-Heun, a director at Deutsche Kreditbank AG, which has financed construction of about 700 wind turbines over the past decade.

Plans to install hundreds of windmills in water about 20 meters (66 feet) deep off the German and U.K. coasts were made before developers gained much expertise in fielding special ships, cranes and equipment that can resist the impact of strong winds and corrosion by salt.

"Offshore simply has a different cost structure and this has an influence of the profitability," Harder-Heun said yesterday after a wind-industry presentation in Husum, Germany.

Financing for projects built on land, which have a longer history and lower operating costs, have been largely unimpeded by the global credit crisis, Harder-Heun said.

European Union governments promoted wind turbines to help meet a target to get 20 percent of energy supplies from renewable sources by 2020, designed to combat climate change.

The limited availability of credit also has directed investment more to less-risky onshore projects, Maartje van den Berg, a clean-technology analyst at Rabobank International, said in an October interview.

Growth of all types of wind-turbine installations in Germany has slowed from a peak in 2002. Generating capacity rose 7.4 percent last year, below a 50 percent gain in the U.S., which took away Germany's No. 1 ranking by that measure, according to the Brussels-based Global Wind Energy Council trade group.

Largest Power Market

German capacity was 23,900 megawatts at Dec. 31, enough to power 35.9 million homes if all turbines are running.

The nation's wind-energy industry forecasts a capacity of 55,000 megawatts by 2020 in Europe's largest power market, more than double the existing figure.

Overall, German wind-turbine makers will post "double- digit" sales growth this year, boosted by domestic and international markets, Thorsten Herdan, president of VDMA Power Systems, said last month. The gain is being helped by a law that supports electricity generated by renewable energy.

Germany in June updated its so-called renewable energy law, providing investors with guaranteed prices for clean power for another two decades. Over coming years the new law will reduce the premium paid on top of the regular price to encourage makers of windmills and solar panels to cut costs.

Utilities in Germany pay solar and wind generators a fixed amount for each kilowatt-hour of power they feed into the local grid. While fixed payments for renewable energy generation will be less this year, they are still higher than tariffs for electricity generated from conventional sources such as coal.