Feb 23 (Reuters) – The largest-ever U.S. sale of offshore wind development rights — for areas off the coast of New York and New Jersey — drew record bids on Wednesday from companies seeking to be part of President Joe Biden’s construction plan. A thriving new domestic industry.
It’s the first offshore wind lease sale under Biden, who has made offshore wind expansion a cornerstone of his strategy to tackle global warming and decarbonize the US power grid by 2035, all while creating thousands of jobs.
As bidding continued on Wednesday afternoon, combined live bidding for the six leases reached $891.6 million, easily surpassing the $405 million U.S. offshore wind auction record in 2018, according to updates posted on the U.S. Bureau of Energy Administration’s Web site. Oceans (BOEM). Location.
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After 14 rounds, bids reached a record $315 million for a single lease 32 miles (51.5 km) off the coast of New Jersey. The government designated that 114 acres – the largest for sale – as capable of producing energy for more than 485,000 homes.
Direct bids on three other lease areas on offer were also well above the previous record of $135.1 million paid for a US offshore wind lease from 2018.
The volume of the auction represents a major step forward for offshore wind energy in the United States, which has lagged behind European countries in technology development. Currently, the United States has only two small offshore wind power facilities, off the coast of Rhode Island and Virginia, along with two additional commercial-scale projects recently approved for development.
BOEM, which has not auctioned wind leases since 2018, is offering 488,201 acres (197,568 ha) in the shallow waters between Long Island and New Jersey in New York, an area known as New York Bay.
The area is 22% smaller than what was initially suggested last summer due to concerns about the impact of developments on commercial fishing and military interests.
Enough wind to generate millions of homes
FILE PHOTO: Power-generating windmill turbines at the offshore wind farm Eneco Luchterduinen near Amsterdam, the Netherlands on September 26, 2017. REUTERS/Yves Hermann
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The 25 approved bidders include entities controlled by Equinor ASA (EQNR.OL)Avangrid Inc (AGR.N)and BP Plc and Eletricite de France SA (EDF.PA)According to government documents. Each bidder may win only one rental contract.
The administration said the power generated from the newly offered areas could one day supply nearly two million homes.
Last year, the Biden administration set a goal of installing 30 gigawatts of offshore wind by 2030 along the country’s coasts. Much of the current development occurs in the waters off the northeastern states.
New York and New Jersey have set goals to build more than 16 gigawatts of offshore wind by 2035, and Wednesday’s lease areas — which lie between 20 and 69 nautical miles off the coast, according to BOEM — could provide more than a third of that capacity. .
“That’s enough wind to power millions of homes,” Ed Botosnak, executive director of the New Jersey Association for Environmental Conservation, said in an interview. “This is a big deal in a country of about nine million people.”
Not everyone supports offshore wind development. The Biden administration’s ambitions have raised concerns of commercial fishermen and coastal communities about damage to their livelihoods and property values.
In January, a group of New Jersey residents sued BOEM over its lease plans for New York Bay. The group, from the summer colony of Long Beach Island, is concerned about the aesthetic effects of the turbines and potential lost tourism.
Greg Kodnick, owner of a fishing boat company on Long Beach Island, is concerned about what thousands of wind turbines will do to the ocean habitat.
“With all this going on and all this at risk for me, I don’t see the net benefits,” Kudnick said.
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(Reporting by Nicola Groom in Los Angeles and Kristen Kiernan in Shipbottom, New Jersey; Editing by Bill Bercrot and Diane Kraft
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