Administration Proposes First Offshore Wind Lease Sales for Gulf of Mexico

WASHINGTON — The Biden administration is seeking to move forward with the first-ever lease sale for offshore wind power development in the Gulf of Mexico.

In an announcement on Wednesday, the Interior Department released a proposed lease sales notice for approximately 102,480 acres off the coast of Lake Charles, Louisiana, and two additional parcels closer to Galveston, Texas; one about 102,480 acres and the other 96,786.

The Bureau of Ocean Energy Management is seeking comment on which, if any, of these offshore lease efforts should be offered in a Final Sale Notice.

According to government officials, the combined areas have the potential to power almost 1.3 million homes.

The agency is also seeking feedback on several lease stipulations intended to reaffirm the administration’s commitment to:

• Supporting workforce training programs for the offshore wind industry, developing a domestic supply chain for the offshore wind industry, or a combination of both.
• Establishing and contributing to a fisheries compensatory mitigation fund or contributing to an existing fund to mitigate potential negative impacts to commercial and for-hire recreational fisheries caused by offshore wind development in the Gulf of Mexico.
• Requiring that lessees provide a regular progress report summarizing engagement with tribes and ocean users potentially affected by proposed offshore wind activities.

The bureau said on Wednesday that it will publish its Notice of Proposed sale later this month.

That publication will initiate a 60-day public comment period.

If the department decides to proceed with the sale, BOEM will publish a Final Sale Notice at least 30 days ahead of the sale, which would announce its time and date and the companies that have been deemed qualified to participate in it.

“America’s clean energy transition is happening right here and now,” said Interior Secretary Deb Haaland in a written statement.

“There is no time to waste in making bold investments to address the climate crisis, and building a strong domestic offshore wind industry is key to meeting that challenge head on,” she added.

The announcement of the proposed sale follows earlier lease sales off the East and West coasts. 

As previously reported by The Well News, the first auction of leases off the Pacific coast of the U.S. in December brought in $757 million.

An earlier lease sale, for an area known as the New York Bight, was even more successful, netting $4.37 billion.

BOEM’s announcement of its latest lease sale proposal coincided with the Business Network for Offshore Wind’s publication of its 2023 U.S. Offshore Wind Market Report.

The nonprofit sees 2023 as the year when the United States transitions from “demonstration to commercialization” of offshore wind as its first two commercial-scale projects, Vineyard Wind and South Fork Wind, begin construction and prepare to bring 932 MW of clean power to the grid.

“While the U.S. offshore wind market will continue to be dominated by state electricity demands, new market opportunities are emerging globally that harness offshore wind’s power output for alternative uses, including green hydrogen production, green ammonia production and carbon sequestration activities,” the report said about impacts of the Inflation Reduction Act, adding, “The first major U.S. announcement pairing green hydrogen and offshore wind occurred last year in Louisiana.”

The organization also foresees a continued expansion of the offshore wind sector, largely due to the IRA and its 30% investment tax credit for offshore wind projects.

But all this is not to suggest there’s nothing happening on the fossil fuel front.

In fact, the day after BOEM announced the proposed wind energy lease sale in the Gulf of Mexico, it finalized plans to hold an oil and gas lease sale in another portion of the Gulf on March 29.

Gulf of Mexico Oil and Gas Lease Sale 259 will offer approximately 13,600 blocks on 73.3 million acres in the Western, Central and Eastern Planning Areas on the U.S. Outer Continental Shelf. 

The lease sale will be accessible via a link on www.boem.gov, with opening bids opening and being read on March 28.

The Final Notice of Sale, a copy of the Record of Decision affirming the sale, a map of the lease sale area and instructions for bidding are available at http://www.boem.gov/sale-259.

Dan can be reached at [email protected] and at https://twitter.com/DanMcCue