Denmark-based DONG Energy says it will develop the Massachusetts offshore wind lease area that was recently awarded to RES Americas.
On Jan. 29, the Bureau of Ocean Energy Management (BOEM) awarded one of two leases off the coast of Massachusetts to RES Americas. The lease comprises an area located 55 miles from shore and could potentially accommodate more than 1 GW of installed capacity.
The transaction requires BOEM approval. If approved, DONG will take ownership of the lease. RES Americas will continue to support development of the lease area as agreed with DONG Energy.
DONG Energy sees strong potential in the project and says the offshore site location possesses many of the same characteristics as some offshore wind projects it has developed in Europe. The lease area has a total size of 22,239 acres and has water depths between 130 feet to 165 feet.
‘The U.S. is an interesting new market for offshore wind with the potential to become a significant area for future development,’ explains Samuel Leupold, executive vice president at DONG Energy Wind Power. ‘We have constructed around one-third of the offshore wind capacity in the world, and we are looking forward to bringing our skills and experience to this new market.’
During recent years, the cost of offshore wind has been significantly reduced for projects in Europe. DONG Energy believes the same trend is possible in the U.S. Cost reductions have been achieved through technology improvements as well as a maturing supply chain, which is the result of a sizable rollout of offshore wind in northern and western Europe that was enabled by stable and predictable policy frameworks.
DONG says it is encouraged by a draft policy bill circulating in Massachusetts that aims to provide a stable framework to enable the build-out of projects and the creation of new jobs. In January, Rep. Patricia Haddad, D-Somerset, introduced legislation that would require distribution companies to enter into long-term contracts with offshore wind energy developers to facilitate the financing of offshore wind.
‘Building large-scale energy infrastructure projects, such as offshore wind farms, requires stable framework conditions and dedicated political support,’ says Leupold. ‘We have more than 20 years of experience in developing and building offshore wind farms in Europe. We are excited to work constructively with regulators, potential suppliers and contractors to establish a successful offshore wind industry in Massachusetts.’
DONG Energy built the first offshore wind farm in 1991 and has since installed more than 2.6 GW in offshore wind capacity, making it the global market leader in this sector. The company is currently building another 1.3 GW in installed capacity in Germany and the U.K. and targets to build a total of 6.5 GW by 2020.
