Interior sells $448K in leases off Mass.
The auction was brief, lasting two rounds before the Bureau of Ocean Energy Management declared Offshore MW LLC and RES America Inc. as the provisional winners of 187,523-acre and 166,886-acre tracts, respectively.
Two other lease tracts totaling about 388,000 acres received no bids.
“We are pleased to see continued commercial interest in the offshore wind industry, as demonstrated by today’s lease sale, particularly given the water depth of the wind energy area offshore Massachusetts,” BOEM Director Abigail Ross Hopper said in a statement. “With provisional winners who are well established and have experience in developing wind energy facilities, we are optimistic about a strong renewable energy future offshore Massachusetts.”
Today’s sale nearly doubles the amount of waters Interior has leased through competitive bidding.
But the auction, BOEM’s fourth since July 2013, appeared to draw far less industry demand than previous sales off the coasts of Massachusetts-Rhode Island, Virginia and Maryland that generated more than $14 million in high bids for more than 357,500 acres.
Roughly a dozen companies were qualified to place bids in today’s auction.
The winning bidders will have the exclusive right to build a wind farm, should they choose to do so. They’ll have one year to submit a site assessment plan to BOEM to install devices like meteorological towers or buoys. If approved, the companies will then have up to five years to submit a construction and operations plan, a move that would trigger a separate environmental review.
Today’s lease came during a tumultuous time for the U.S. offshore wind industry.
Earlier this month, the 130-turbine Cape Wind project off Nantucket Sound, Mass., which many believed would be the nation’s first-ever offshore wind farm, suffered a major setback when two utilities opted to terminate agreements to purchase its power (Greenwire, Jan. 7).
Developers also have no indication whether a Republican-controlled Congress will renew a lucrative 30 percent investment tax credit that industry officials say is critical to getting the first projects built.
The Boston Globe earlier this month published an editorial noting that BOEM is auctioning waters farther from shore, where they will incite less controversy than Cape Wind.
BOEM raised $3.8 million in its first competitive auction in 2013 off the coasts of Rhode Island and Massachusetts, selling a 257-square-mile area to Deepwater Wind New England LLC, which plans to build a 1,000-megawatt wind farm on the federal lease.
“Due to both controversy and mismanagement, Cape Wind appears all but dead,” the Globe wrote. “And, yes, its demise is a blow to Massachusetts’ ambitions to harness the power of wind — but it should, by no means, be a death knell.”
The waters BOEM put up for sale today could support up to 5,000 megawatts of wind generation, according to scientists at the National Renewable Energy Laboratory in Golden, Colo.