The Department of the Interior (DOI) held its first competitive lease sale for renewable energy in federal waters in July. There have been many oil and gas lease sales for the U.S. Gulf of Mexico, but this is the first for wind farm development.
The July 31 sale auctioned two leases for a Wind Energy Area of 164,750 acres offshore Rhode Island and Massachusetts for wind energy development. Deepwater Wind New England LLC was the high bidder.
The DOI’s Bureau of Ocean Energy Management (BOEM) auctioned the Wind Energy Area offshore Rhode Island and Massachusetts as two leases — North Lease Area (Lease OCS-A0486) and South Lease Area (Lease OCS-A0487). The North Lease Area consists of about 97,500 acres and the South Lease Area covers about 67,250 acres. The sale drew $3.8 million in high bids. The one-day auction consisted of 11 rounds before the provisional winner was determined. In addition to Deepwater Wind New England, Sea BreezeEnergy LLC and US Wind Inc. participated in the auction.
“The auction was for the right to develop the area,” said BOEM spokesperson Tracey Moriarty. “Now the company has to put together a construction plan and a full fledged environmental impact statement.”
The Wind Energy Area is located 9.2 nautical miles south of the Rhode Island coastline and has the potential to support 3,395 megawatts of wind generation. When built, these areas could generate enough combined energy to power more than one million homes.
Moriarty said the lease sale and those coming in the future are spurring economic development in coastal port cities. “Ports like New Bedford (Mass.) and Quonset Bay (R.I.) and others are involved in significant infrastructure development all being financed by private industry.”
Moriarity said BOEM is working with states interested in wind farms off their coastlines to identify potential concerns before problems arise. “We try to identify issues up front,” she said.
BOEM’s next competitive lease sale for offshore wind will be held on Sept. 4. It will auction nearly 112,800 acres offshore Virginia. BOEM is expected to announce additional auctions for Wind Energy Areas offshore Massachusetts, Maryland, and New Jersey later this year and in 2014.
The sale is part of the Obama administration’s all-of-the-above energy strategy, which has led to domestic oil and gas production growth.