First-Ever Auction for Offshore Wind Takes Place in July

The first-ever auction for offshore wind leases will be held July 31, offering 164,750 acres in federal waters near Rhode Island and Massachusetts. 

The area is being divided into two leases, says the Bureau of Ocean Energy Management (BOEM), who is conducting the auction. 

The North Lease has the potential for 1,955 megawatts (MW) and the South Lease, 1,440 MW. Together, they can support projects that bring electricity to over 1 million homes.

And the auction is based on other factors in addition to money, such as whether a bidder has a Power Purchase Agreement.

"This is history in the making," says Secretary of Interior Sally Jewell. "Today we are moving closer to tapping into the enormous potential offered by offshore wind to create jobs, increase our sustainability, and strengthen our nation’s competitiveness in this new energy frontier."

The areas to be leased have been identified as part of the Department of Energy’s Smart from the Start" program, launched in 2011.

"We have successfully engaged key stakeholders, including industry, commercial fishers and environmental organizations, to address potential conflicts early in the process. Now, after months of hard work, we are ready to auction a large area offshore Rhode Island and Massachusetts that is well suited for commercial wind energy development with minimal impacts to the environment and other important uses," says Tom Beaudreau, director of BOEM.

BOEM will also host a mock auction for eligible companies that have expressed interest in these particular leases: 

  • Deepwater Wind New England, LLC
  • EDF Renewable Development, Inc.
  • Energy Management, Inc.
  • Fishermen’s Energy, LLC
  • Neptune Wind, LLC
  • Sea Breeze Energy, LLC
  • U.S. Mainstream Renewable Power (Offshore) Inc.
  • US Wind Inc.

"After careful review, BOEM has determined that these companies are legally, technically and financially qualified to participate in the upcoming lease sale," says Beaudreau. "They represent pioneers in a new energy frontier as participants in America’s first offshore wind energy auction this July. We congratulate them on their entrepreneurial spirit and look forward to overseeing a fair and competitive leasing process."

Two offshore areas have thus far been approved for leases – NRG Bluewater Wind off of Delaware and Cape Wind off Massachusetts. 

Two reports that came out last year show that offshore wind in the Atlantic Ocean could power the entire East Coast, creating $200 billion in economic activity.

While Democrats lauded the move, Republicans criticized it. 

Senator David Vitter (R- LA), the top Republican on the Environment and Public Works Committee, says the Obama administration is "picking energy industry winners and losers."

"While they do everything they can to advantage renewable energy production, they ignore the benefits that traditional energy provides," he says. Instead, offshore waters should be completely opened to oil and gas drilling as they propose in their energy legislation.

In the press release announcing the offshore wind lease sale it says:

"Domestic oil and gas production has grown each year President Obama has been in office, with domestic oil production currently higher than any time in two decades; natural gas production at its highest level ever; and renewable electricity generation from wind, solar, and geothermal sources having doubled. Combined with recent declines in oil consumption, foreign oil imports now account for less than 40 percent of the oil consumed in America – the lowest level since 1988."

The Department of Interior proposed a 5-year plan for offshore oil-and-gas leasing in 2011, closing off much of the east and west coasts for environmental reasons. The plan "makes more than 75% of undiscovered technically recoverable oil and gas resources estimated in federal offshore areas available for exploration and development," it says.

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