The Trump administration hailed Friday a record offshore wind lease sale off the coast of Massachusetts, trumpeting the success as evidence that its emphasis of U.S. energy dominance includes renewable energy along with fossil fuels.
“To anyone who doubted that our ambitious vision for energy dominance would not include renewables, today we put that rumor to rest,” Interior Secretary Ryan Zinke said. “With bold leadership, faster, streamlined environmental reviews, and a lot of hard work with our states and fishermen, we’ve given the wind industry the confidence to think and bid big.”
The sale, conducted over 32 rounds of bidding in two days, generated more than $405 million in winning bids toward three offshore wind lease opportunities — the highest grossing offshore wind lease sale in Interior’s history. The largest single bid was $135.1 million.
The previous high was Norwegian oil and gas giant Equinor’s $42.47 million bid in 2016 to build an offshore wind farm near New York.
Three companies out of 11 participants were deemed winners of the auction: Equinor Wind, Mayflower Wind Energy, and Vineyard Wind.
The Bureau of Ocean Energy Management’s offshore wind auction covered 390,000 acres, an opportunity that could support 4.1 gigawatts of electricity and power nearly 1.5 million homes, the bureau says.
“Wow,” said BOEM’s Acting Director Walter Cruickshank in a press call. “We are truly blown away by today’s result.”
The strong results suggest that what was once a fringe and costly investment is becoming America’s newest energy-producing industry. BOEM now has 15 active wind leases, covering nearly two million acres in federal waters.
“[The result] is indicative of the strength of a growing industry of offshore renewable energy,” Jim Bennett, program manager for BOEM’s Renewable Energy Program, said on the press call. “There is just a growing interest and large number of companies that want to get into this market.”
Bennett, along with outside experts, credited Massachusetts for setting ambitious offshore wind targets.
Stephanie McClellan, director of the special initiative on offshore wind at the University of Delaware, told the Washington Examiner that states from Maryland to Massachusetts have committed to projects equal to 10 gigawatts of offshore wind.
“The swift and expeditious action by the states to issue solicitations for offshore wind and the willingness of utilities to contract for offshore wind power is showing the offshore wind industry that the U.S. market is not just a political aspiration of renewable energy advocate governors and legislatures, but rather that it is a part of those states’ energy portfolios going forward,” McClellan said.
Northeast states like New York and New Jersey, with huge populations along their coasts, are targeting offshore wind as a major component of their efforts to increase their renewable portfolios.
The Interior Department has also begun a process to auction offshore federal waters off the coast of New York, and is exploring the prospects of doing the same off the coast of California for the first time ever.
So far, Block Island, a small 30-megawatt wind farm off the Rhode Island coast that can power 17,000 homes, is the nation’s only current offshore project.
Offshore wind has long struggled to gain traction in the U.S. to keep pace with Europe, where the energy source is mainstream, cheap, and has benefited from subsidies, especially in northern countries such as Britain and Germany. But costs have dropped in the U.S. as more companies have competed for leases, and technology has become cheaper.
“There is nothing more key to the viability of an offshore wind industry in the U.S. than competitive pricing,” McClellan said.
Advocates say the U.S. can profit from being behind Europe, copying the technologies that have been successful, learning from mistakes, and entering the market when it’s more mature with lower cost.
