Interior Department Holds First Pacific Coast Offshore Wind Lease Sale

By Christian Roselund

On 7 December 2022 the U.S. Department of the Interior announced the results of its offshore wind lease sale for sites of the California coast, drawing high bids that totaled $757.1 million for five lease areas totaling 1,511 square kilometers. The five companies with high bids include RWE, Equinor, Invenergy, and an affiliate of Copenhagen Infrastructure Partners.

This is the Interior Department’s first offshore wind lease sale on the Pacific Coast. Unlike the Atlantic Coast, where turbines can be anchored to the ocean floor in shallower water, these West Coast lease areas are in deep water and will require floating wind turbine designs. The sites auctioned off have the capacity to host 4.6 gigawatts of wind turbines.

The Interior Department has noted that the $757.1 million is far more than was paid for the first sites offered on the Atlantic Coast. However, the $0.501 per square meter figure for West Coast sites is less than a quarter of the $2.21 per square meter that was raised in the sale of offshore wind leases off the coast of New York and New Jersey in February 2022. UtilityDive cites the absence of state mandates for offshore wind and secured power purchase agreements as drivers of the lower cost.

The West Coast sale included a 20% credit adder for bidders who committed to donate money to programs to support workforce training programs, the development of a domestic supply chain, or both. There is an additional 5% credit adder for bidders who committed to entering into community benefit agreements.

Source: Biden-Harris Administration Announces Winners of California Offshore Wind Energy Auction (Bureau of Ocean Energy Management)

News coverage: First West Coast offshore wind lease auction generates $757 million, lagging East Coast result (UtilityDive)