The US’s biggest offshore wind lease sale attracted record bids of more than $4bn, outstripping any oil and gas auction in American waters, as renewable energy developers compete to secure a prime location to install turbines.
The federal government auction of 488,000 acres in the Atlantic Ocean near New York and New Jersey drew in high bids totalling $4.37bn after a three-day auction process ending on Friday, according to the Bureau of Ocean Energy Management. The sum dwarfs previous wind lease sales.
The demand for leases in the area, known as the New York Bight, comes as US President Joe Biden looks to kick-start the country’s nascent offshore wind sector as part of a broader push to decarbonise its power industry by 2035. The administration has set a goal of 30 gigawatts of wind power in US waters by 2030 — enough to power about 10mn homes a year.
Coastal states such as New Jersey and New York have also set their own targets for offshore wind power.
The biggest of the six lease blocks under the hammer went for $1.1bn to Bight Wind Holdings, a venture between utilities RWE of Germany and National Grid of the UK. The amount was more than eight times the previous record for a single area.
A venture between the oil major Shell and French utility EDF snapped up another block, while Portugal’s EDP Renewables and France’s Engie jointly took a third one.
“This week’s offshore wind sale makes one thing clear: the enthusiasm for the clean energy economy is undeniable and it’s here to stay,” said Deb Haaland, US interior secretary.
The nation’s previous offshore wind auction in 2018, for 390,000 acres off the coast of Massachusetts, brought in $405mn.
The record paid for oil and gas drilling rights in US waters was $3.7bn in the Gulf of Mexico in 2008, according to Department of the Interior data.
The most recent oil and gas lease sale of an area covering about 1.7mn acres in the Gulf last year — the only such auction held since Biden took office — drew high bids of $192mn. It was later thrown out by a federal court.
While US onshore wind farms account for 124GW of capacity, only two small offshore operations have been built in the country to date, leaving it far behind Europe.
The permitting process has been expedited under the current White House. Two large wind farms have been fully permitted and begun construction.
The latest auction was the first of as many as seven offshore lease sales the administration hopes to hold by the end of 2025. Others are planned off the coasts of the Carolinas and California later this year, the interior department said.
