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BOEM Set for Latest Offshore Wind Lease Sale Off the Carolinas

Mike Schuler
Total Views: 1028
May 10, 2022

The U.S. Department of the Interior’s Bureau of Ocean Energy Management (BOEM) will hold its next wind energy lease auction on Wednesday, offering two lease areas in federal waters off the North Carolina and South Carolina for potential offshore wind development.

The lease areas cover 110,091 acres in the Carolina Long Bay area that, if developed, could result in at least 1.3 gigawatts (GW) of offshore wind energy, or enough to power nearly 500,000 homes.

The wind energy lease sale will be the second of the Biden Administration and follows the historic lease sale held in February in the New York Bight. That lease sale, which offered six lease areas totaling over 488,000 acres off New York and New Jersey, attracted an unprecedented $4.37 billion in winning bids after three days, making it the highest-grossing offshore energy lease sale in U.S. history—including oil and gas.

While the Carolina lease sale isn’t expected to raise nearly as much as the New York sale, it will be interesting to see the level of interest from offshore wind developers and final amount.

The Carolina Long Bay sale will allow developers to bid on one or both of the lease areas within the Wilmington East Wind Energy Area (WEA), which are similar in acreage, distance to shore, and wind resource potential.

BOEM’s Final Sale Notice (FSN) includes several lease stipulations designed to promote the development of a domestic U.S. supply chain, advance flexibility in transmission planning, and encourage project labor agreements, like the one signed last week Ørsted and North America’s Building and Trade Unions (NABTU).

Among the stipulations, BOEM will offer a 20 percent credit to bidders if they commit to invest in programs that will advance U.S. offshore wind energy workforce training or supply chain development.

The leases will also require lessees to identify Tribal Nations, underserved communities, agencies, ocean users and other interested stakeholders, and report on their communication and engagement activities with these parties.

“These stipulations are intended to promote offshore wind energy development in a way that coexists with other ocean uses and protects the ocean environment, while also facilitating our nation’s energy future for generations to come,” BOEM said in a statement announcing the lease sale. “These innovative stipulations were embraced in the Department’s recent lease sale for the New York Bight, which set a record as the nation’s highest-grossing competitive offshore energy lease sale in history, including oil and gas lease sales.”

In its Proposed Sale Notice (PSN) published in November 2021 regarding the Wilmington East WEA, BOEM proposed leasing of nearly 128,000 acres and requested public comment, but BOEM said the amount of acreage being offered is reduced by 14 percent from the initial proposal to avoid conflicts with ocean users and minimize environmental impacts.

To achieve its goal of deploying 30GW of offshore wind energy by 2030, the Biden Administration is planning to hold up to seven lease sales by 2025, including the Carolina Long Bay and New York Bight lease sales. Lease sales are also being planned for offshore California and Oregon, as well as in the Central Atlantic, Gulf of Maine, and the Gulf of Mexico.

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