Feds grant two offshore wind leases off New Jersey coast

Dive Brief:

Two wind developers, RES America Developments and U.S. Wind Inc., were awarded leases by the Department of Interior's Bureau of Ocean Energy Management (BOEM), and can now start developing 344,000 acres of federal waters off New Jersey’s Atlantic coast, the Hill reports.
The two companies could spend over $1.8 million developing wind farms in the New Jersey waters that could produce enough wind-generated electricity to power 1.2 million homes, according to the Department of Energy.
These New Jersey leases are the eighth and ninth commercial wind leases granted by BOEM in competitive bidding. Previous auctions resulted in two leases in Rhode Island-Massachusetts ocean acreage, two others off Massachusetts, two off Maryland, and one off Virginia.

Dive Insight:

Federal officials said the New Jersey lease is aimed at sparking more renewables development in line with the Obama administration's climate goals. The Department of Interior Secretary Sally Jewell described the lease sale as a "major step in standing up a sustainable offshore wind program for Atlantic coast communities."

When complete, the 30 MW five-turbine installation off Rhode Island’s Block Island that's being developed by Deepwater Wind will be the first operational U.S. offshore wind facility. The facility will start construction this summer and is expected online by 2017, with the power purchase agreement calling for all its output to go to National Grid at $0.244 per kWh.

Developers Alpha Wind Energy and Progression Hawaii Offshore Wind recently proposed similar 400 MW offshore wind installations off Oahu’s coast in Hawaii. Progression executives said they could deliver electricity at below $0.20 per kWh, which is a little lower than Oahu's $0.263 per kWh average residential electricity price.

The DOE’s Wind Vision report forecasts offshore wind to achieve cost reductions of 22% by 2020, 43% by 2030, and 51% by 2050. By utilitizing just 5.5% of the U.S. ocean wind resource, offshore wind can meet 2% of U.S. electricity demand in 2030 and 7% in 2050. The report projects 3 GW of installed capacity off the U.S. coasts by 2020, 22 GW by 2030, and 86 GW by 2050.