Dive Brief:
- The U.S. Department of the Interior (DOI) will auction an 81,130-acre sector of the outer continental shelf off New York for offshore wind development leases. Seven developers have been designated by DOI as eligible to bid in lease auctions.
- The acreage proposed for leasing, 11 miles south of Long Island, was certified as a Wind Energy Area earlier this year by the Bureau of Ocean Energy Management (BOEM) after the DOI sub-agency did an Environmental Assessment of the tract. BOEM will publish that assessment June 6.
- A notice of the auction will be published in the Federal Register on June 6 and opened to public comment for 60 days. BOEM will hold a public seminar in late June or July to describe the auction process.
Dive Insight:
The site is one of 12 Atlantic sites identified by BOEM as Wind Energy Areas potentially suitable for development. There are two sites off Rhode Island and Massachusetts, two off Maryland, two off New Jersey, one off Virginia, one off Massachusetts, and one off Delaware.
The biggest attraction of this acreage off Long Island is its adjacency to major load centers. BOEM estimates its capacity at more than 900 MW.
Europe has over 11 GW of installed offshore wind but the U.S. industry has not opened up because high development costs have kept the levelized cost of energy (LCOE) at more than double the market electricity rate in many eastern states.
When it goes online late this summer, Deepwater Wind's 30 MW Block Island Wind Farm off Rhode Island's coast will be the first U.S. offshore wind project. Its 20-year contract calls for all output to go to National Grid at $0.244/kWh.
While costs for U.S. offshore wind remain high, scale could help them to fall. A recent study from the University of Delaware said a commitment to develop 2,000 MW of ocean wind off Massachussetts between 2020 and 2030 could lead to an LCOE of $0.108/kWh by 2030.
