US Wind Inc. has been crowned the provisional winner of the U.S.' third competitive offshore wind lease auction, which the Bureau of Ocean Energy Management (BOEM) held Tuesday for two parcels totaling nearly 80,000 acres offshore Maryland.
The company, a subsidiary of Italian developer Renexia, won with a bid of over $8.7 million for both Maryland lease areas and was up against Green Sail Energy LLC and SCS Maryland Energy LLC. The auction lasted 19 rounds.
The Maryland Wind Energy Area (WEA) consists of two leases, referred to as the North Lease Area (32,737 acres) and the South Lease Area (46,970 acres). According to the National Renewable Energy Laboratory, the WEA has the potential to support between 850 MW and 1.45 GW of commercial wind generation.
"Today's results are a major achievement and reflect industry confidence as we strengthen our nation's foothold in this new energy frontier," says U.S. Department of the Interior (DOI) Secretary Sally Jewell. "I want to thank Governor Martin O'Malley, his team and members of BOEM's Maryland Intergovernmental Renewable Energy Task Force for all of their hard work and leadership leading up to today's successful auction. The collaboration and thoughtful planning that went into this lease sale will serve as a model as we continue up and down the coast in our efforts to ensure wind energy is developed in the right way and in the right places."
The Attorney General, in consultation with the Federal Trade Commission, will have 30 days in which to complete an antitrust review of the auction. BOEM will then send unsigned copies of the lease form to the winning bidder, which will have 10 days to sign and return the leases, file required financial assurance and pay the balance of the winning bid.
Each lease will have a preliminary term of one year, during which the lessee will submit a site assessment plan to BOEM for approval. The plan describes the activities (installation of meteorological towers and buoys) a lessee plans to perform for the assessment of the wind resources and ocean conditions of its commercial lease area.
If a site assessment plan is approved, BOEM says the lessee will then have up to four-and-a-half years in which to submit a construction and operations plan (COP) to the agency for approval. This plan provides detailed information for the construction and operation of a wind energy project on the lease. After BOEM receives a COP from a lessee, BOEM will conduct an environmental review of the proposed project.
The DOI says this latest auction builds on the agency's work to stand up a sustainable offshore wind program for the Atlantic Coast. Previously, BOEM awarded five commercial wind energy leases off the Atlantic Coast: two noncompetitively issued leases (one for the proposed Cape Wind project in Nantucket Sound offshore Massachusetts and one offshore Delaware); and three competitively issued leases (two offshore Rhode Island-Massachusetts and another offshore Virginia). The competitive lease sales generated over $5 million in winning bids for more than 277,500 acres in federal waters. BOEM plans to hold additional competitive auctions for WEAs offshore Massachusetts and New Jersey in the coming year.