(WASHINGTON) — The Department of the Interior on Tuesday held the first offshore wind energy auction for the Gulf of Mexico region, resulting in one lease area receiving a high bid of $5.6 million. Two lease areas offered did not receive any bids.
RWE Offshore US Gulf LLC was the winner of the Lake Charles Lease Area, which has the potential to generate approximately 1.24 gigawatts of offshore wind energy capacity and power nearly 435,400 homes.
“(This) lease sale represents an important milestone for the Gulf of Mexico region — and for our nation — to transition to a clean energy future,” said Bureau of Ocean Energy Management (BOEM) Director Elizabeth Klein. “The Lake Charles Lease Area will have the potential to generate enough electricity to power about 435,400 homes and create hundreds of jobs.”
The Interior Department has approved the nation’s first four commercial-scale offshore wind projects, held four offshore wind lease auctions — including a record-breaking sale offshore New York and the first sales offshore the Pacific and Gulf coasts — initiated environmental review of 10 offshore wind projects, and advanced the process to explore additional Wind Energy Areas in Oregon, the Gulf of Maine and the central Atlantic. The department has also taken steps to evolve its approach to offshore wind to drive toward union-built projects and a domestic supply chain.
BOEM’s lease sale offered two areas offshore Galveston, Texas, one comprising 102,480 acres and the other 96,786 acres, and a third, 102,480-acre area offshore Lake Charles, La. The two Galveston lease areas offered did not receive bids.
RWE Offshore US Gulf earned the following bidding credits:
• A credit equal to 20 percent of the cash bid to bidders who commit to supporting workforce training programs and developing a domestic supply chain for the offshore wind energy industry.
• A credit equal to 10 percent of the cash bid to bidders for establishing and contributing to a fisheries compensatory mitigation fund or contributing to an existing fund to mitigate potential negative impacts to commercial and for-hire recreational fisheries caused by offshore wind energy development in the Gulf of Mexico.
These bidding credits will result in over $860,000 in investments for workforce training and a domestic supply chain, and another $430,000 for fisheries compensatory mitigation.
BOEM is committed to workforce development and safety and to the establishment of a durable domestic supply chain that can sustain the U.S. offshore wind energy industry. As such, BOEM included two lease stipulations, one that encourages project labor agreements and construction efficiency and the other that contributes toward establishing a domestic supply chain.
In addition, the lessee is required to engage with tribes, ocean users and local communities that may be affected by lease activities. The engagement activities must be routinely reported to BOEM. The purpose of such engagement is to promote offshore wind energy development in a way that coexists with other ocean uses, addresses potential impacts and benefits, and protects the ocean environment, while also facilitating our nation’s energy future for generations to come.
– Bureau of Ocean Energy Management
