The US Department of the Interior (DOI) has leased out three areas in the country’s federal waters for potentially 4.1GW or so of new offshore wind development off the Massachusetts coast for a total of around $405m.
The offshore wind power market is now worth $60bn globally
Three companies – Equinor Wind US, Mayflower Wind Energy and Vineyard Wind prevailed in the eighth competitive lease sale for the new offshore wind development in the US federal waters held by the Bureau of Ocean Energy Management (BOEM).
The lease sale had offered nearly 390,000 acres offshore Massachusetts for potential development of wind farms.
According to DOI, the leased areas if developed fully could support the approximate 4.1GW of new offshore wind development. This would result in enough renewable energy to meet the power consumption needs of close to 1.5 million homes, said DOI.
US Secretary of the Interior Ryan Zinke said: “To anyone who doubted that our ambitious vision for energy dominance would not include renewables, today we put that rumor to rest.
“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 three lease areas for the new offshore wind development that were auctioned are located 19.8 nautical miles from Martha’s Vineyard, 44.5 nautical miles from Block Island, and 16.7 nautical miles from Nantucket.
A total of 11 companies bid for the offshore wind leases, which also included EDF Renewables Development, Innogy US Renewable Projects, Northeast Wind Energy among others.
Equinor Wind US, a subsidiary of Norwegian energy company Equinor, bagged rights for the OCS-A 0520 lease, which is spread over 128,811 acres, with a bid of $135m. For the same amount of bid, Mayflower Wind Energy won the OCS-A 0521 leased area, which is spread over 127,388 acres.
The third lease – OCS-A 0522 of 132,370 acres was won by Vineyard Wind for $135.1m.
Prior to the execution of the leases to the three parties, the Department of Justice and Federal Trade Commission will undertake an anti-competitiveness review of the auction. Following this, the three provisional winners will have to pay the winning bid and give financial assurance to BOEM.
The lease will come with a preliminary term of one year, during which the company with the rights may submit a Site Assessment Plan (SAP) to BOEM to seek its approval.
BOEM acting director Cruickshank said: “This auction will further the Administration’s comprehensive effort to secure the nation’s energy future.
“The Commonwealth of Massachusetts and members of the Massachusetts Renewable Energy Task Force have been great partners throughout this process. We look forward to working with them and the lessees as we move forward with next steps for developing offshore wind energy in a responsible manner.”