The U.S. Department of the Interior has auctioned the rights to lease nearly 344,000 acres offshore New Jersey for potential offshore wind energy development.
Under federal law, the Department of the Interior's Bureau of Ocean Energy Management is responsible for leasing marine sites on the Outer Continental Shelf for energy development. In addition to BOEM's oil and gas site leasing programs, the agency also operates renewable energy programs focused primarily on offshore wind and hydrokinetic resources (waves and currents). Prior to yesterday's lease sale, BOEM had awarded nine commercial
offshore wind leases offshore Massachusetts, Maryland, Rhode Island, and Virginia.
In September, BOEM announced that it would auction off the rights to two designated Wind Energy Areas offshore New Jersey. That auction was held yesterday. According to BOEM, the provisional winner of lease area OCS-A 0498 (160,480
acres) was RES America
Developments Inc., with a bid of $880,715. US Wind Inc. provisionally won site OCS-A 0499 (183,353
acres), with a bid of $1,006,240. Fishermen’s Energy LLC also reportedly participated in the lease sale but did not win either parcel.
Generally centered offshore of Atlantic City, the New Jersey Wind Energy Area starts about 7 nautical miles offshore and runs about 21 nautical miles seaward. The U.S. Department of Energy’s
National Renewable Energy Laboratory reports that full development of the area could support about 3,400 megawatts of wind
generation.
Since the Obama administration's early "Smart from the Start" program, BOEM has engaged in efforts to spur offshore wind development. President Obama's June 2013 Climate Change Action Plan features offshore wind as a tool to reduce the emission of carbon dioxide and other greenhouse gases from domestic industry.
This emphasis on the linkage between offshore wind and action on climate change is increasingly clear in the administration's messaging. Early press releases on BOEM's offshore wind programs emphasized "the Obama Administration's all-of-the-above energy strategy to continue to expand domestic energy production." By July 31, 2013, in announcing the first ever competitive lease sale for renewable energy in federal waters, BOEM described "President Obama's comprehensive plan to move our economy toward domestic clean energy sources and cut carbon pollution." Just two months later in September 2013, after the release of the Climate Action Plan, BOEM began using the phrase "President Obama's Climate Action Plan to create American jobs, develop domestic clean energy sources and cut carbon pollution." BOEM continues to use this phrase in touting its offshore wind program's consistency with the Climate Action Plan, as recently as yesterday's press release about the New Jersey lease sale.
Perhaps more tellingly, the Department of Interior press release announcing yesterday's New Jersey sale references "COP21", the upcoming 2015 Paris Climate Conference, in its brief summary. This reference to the Paris climate convention is not otherwise explained in the text of the press release. Nevertheless its inclusion here highlights the interplay between domestic and international energy policy, as well as the potential role U.S. offshore wind might play in addressing climate change.
Energy powers society; society's choices shape energy policy. A blog about our energy resources and the choices they present for society.
Showing posts with label Department of the Interior. Show all posts
Showing posts with label Department of the Interior. Show all posts
US to auction Massachusetts offshore wind sites
Wednesday, December 3, 2014
The U.S. Department of the Interior has announced plans to auction more than 742,000 acres offshore Massachusetts for commercial wind energy development.
On January 29, 2015, the Department's Bureau of Ocean Energy Management will hold a competitive commercial lease sale for the rights to site offshore wind facilities in the federally designated Massachusetts Wind Energy Area. Generally located south of the islands of Martha's Vineyard and Nantucket, the area will be auctioned as four leases. It starts about 12 nautical miles offshore Massachusetts; from its northern boundary, the area extends 33 nautical miles southward and runs about 47 nautical miles from east to west. The Massachusetts Wind Energy Area is significantly larger than previously auctioned areas off Massachusetts, Rhode Island, Virginia, and Maryland. The U.S. Department of Energy’s National Renewable Energy Laboratory has estimated that fully developing the Massachusetts area could support between 4 and 5 gigawatts of commercial wind generation.
BOEM has found twelve companies to be legally, technically and financially qualified to participate in the auction for the Massachusetts Wind Energy Area:
The Massachusetts auction will be the fourth competitive lease sale for renewable energy on the Outer Continental Shelf, following previous auctions for sites off Massachusetts-Rhode Island, Virginia and Maryland. Bidders winning previous auctions have committed over $14 million in bids to secure over 357,500 acres in federal waters. BOEM expects to hold another lease auction for sites offshore New Jersey in 2015.
On January 29, 2015, the Department's Bureau of Ocean Energy Management will hold a competitive commercial lease sale for the rights to site offshore wind facilities in the federally designated Massachusetts Wind Energy Area. Generally located south of the islands of Martha's Vineyard and Nantucket, the area will be auctioned as four leases. It starts about 12 nautical miles offshore Massachusetts; from its northern boundary, the area extends 33 nautical miles southward and runs about 47 nautical miles from east to west. The Massachusetts Wind Energy Area is significantly larger than previously auctioned areas off Massachusetts, Rhode Island, Virginia, and Maryland. The U.S. Department of Energy’s National Renewable Energy Laboratory has estimated that fully developing the Massachusetts area could support between 4 and 5 gigawatts of commercial wind generation.
BOEM has found twelve companies to be legally, technically and financially qualified to participate in the auction for the Massachusetts Wind Energy Area:
- Deepwater Wind New England, LLC
- EDF Renewable Development, Inc.
- Energy Management, Inc.
- Fishermen’s Energy, LLC
- Green Sail Energy, LLC
- IBERDROLA RENEWABLES, Inc.
- NRG Bluewater Wind Massachusetts, LLC
- OffshoreMW, LLC
- RES America Developments, Inc.
- Sea Breeze Energy, LLC
- US Mainstream Renewable Power (Offshore), Inc.
- U.S. Wind, Inc.
The Massachusetts auction will be the fourth competitive lease sale for renewable energy on the Outer Continental Shelf, following previous auctions for sites off Massachusetts-Rhode Island, Virginia and Maryland. Bidders winning previous auctions have committed over $14 million in bids to secure over 357,500 acres in federal waters. BOEM expects to hold another lease auction for sites offshore New Jersey in 2015.
Feds to auction North Carolina offshore wind sites
Friday, August 15, 2014
The U.S. Department of the Interior's Bureau of Ocean
Energy Management has announced plans to auction the rights to lease sites off the
North Carolina coast for offshore wind projects.
Under the Bureau of Ocean Energy Management's "Smart from the Start" competitive program for leasing sites on the outer continental shelf (OCS) for commercial wind energy development, BOEM conducts a series of stakeholder and environmental review processes. Through these processes, BOEM identifies areas that are attractive for commercial offshore wind development, while also protecting important viewsheds, sensitive habitats and resources and minimizing space use conflicts with activities such as military operations, shipping and fishing.
For North Carolina, the process began in December 2012 when BOEM published in the Federal Register a Call for Information and Nominations and a Notice of Intent to Prepare an Environmental Assessment. After considering the public comments and responses, BOEM defined three Wind Energy Areas off North Carolina:
The North Carolina auction will follow a series of similar auctions for East Coast offshore wind sites in federal waters over the past year, including sites off Massachusetts and Rhode Island and Virginia, and will come after the scheduled August 19 auction for sites off Maryland. To date, BOEM has awarded five commercial wind energy leases off the Atlantic
coast: two non-competitive leases (for the proposed Cape Wind project in
Nantucket Sound and an area off Delaware) and three competitive leases
(two offshore Massachusetts-Rhode Island and another offshore Virginia).
Altogether, the competitive lease sales have generated more than $5 million in high bids
for more than 277,500 acres in federal waters. BOEM
expects to hold additional competitive auctions for wind energy areas
offshore Massachusetts and New Jersey in the coming year.
When will North Carolina offshore wind sites be auctioned? Who will bid? Who will win -- and what will the high bid be? Perhaps most fundamentally, will the BOEM leasing process lead to anyone developing a offshore wind project off North Carolina?
Under the Bureau of Ocean Energy Management's "Smart from the Start" competitive program for leasing sites on the outer continental shelf (OCS) for commercial wind energy development, BOEM conducts a series of stakeholder and environmental review processes. Through these processes, BOEM identifies areas that are attractive for commercial offshore wind development, while also protecting important viewsheds, sensitive habitats and resources and minimizing space use conflicts with activities such as military operations, shipping and fishing.
For North Carolina, the process began in December 2012 when BOEM published in the Federal Register a Call for Information and Nominations and a Notice of Intent to Prepare an Environmental Assessment. After considering the public comments and responses, BOEM defined three Wind Energy Areas off North Carolina:
- The Kitty Hawk Wind Energy Area begins about 24 nautical miles (nm) from shore and extends approximately 25.7 nm in a general southeast direction at its widest point. Its seaward extent ranges from 13.5 nm in the north to .6 nm in the south. It contains approximately 21.5 OCS blocks (122,405 acres).
- The Wilmington West Wind Energy Area begins about 10 nm from shore and extends approximately 12.3 nm in an east - west direction at its widest point. It contains just over 9 OCS blocks (approximately 51,595 acres).
- The Wilmington East Wind Energy Area begins about 15 nm from Bald Head Island at its closest point and extends approximately 18 nm in the southeast direction at its widest point. It contains approximately 25 OCS blocks (133,590 acres).
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| Map of North Carolina Wind Energy Areas, courtesy of BOEM. |
When will North Carolina offshore wind sites be auctioned? Who will bid? Who will win -- and what will the high bid be? Perhaps most fundamentally, will the BOEM leasing process lead to anyone developing a offshore wind project off North Carolina?
Feds to auction Maryland offshore wind sites
Monday, August 11, 2014
On August 19, the U.S. Department of the Interior's Bureau of Ocean Energy Management will auction off rights to lease sites off the Maryland coast for offshore wind. Through the auction, which will represent the third auction for offshore wind sites in federal waters since July 2013, the Bureau hopes it will award leases to two areas covering approximately 80,000 acres about
10 nautical miles east of the Ocean City coastline.
Last year, the Department of the Interior held its first offshore wind site auction for sites off Massachusetts and Rhode Island; Deepwater Wind won that auction with a bid of $3.8 million. The second auction, held for Virginia on September 4, covered approximately 112,799 acres about 23.5 nautical miles from the Virginia Beach coastline; Dominion Virginia Power won that auction with a bid of $1.6 million.
The Maryland auction later this month will follow procedures similar to those used in the previous two auctions. Based on previous expressions of interest and qualifications, BOEM has determined that sixteen companies are eligible to bid on the Maryland sites:
Offshore wind project developers must coordinate regulatory, financial, and engineering efforts. Securing a site for a project is a major step forward, but is only one of many important steps necessary to build an operating offshore wind project -- something the U.S. still lacks. How much interest will the Maryland auction draw? Who will win the right to lease the two parcels in the Maryland wind energy area, and how much will they pay? Will the auction winners actually build offshore wind projects? Some of these questions will be answered when the auction closes on August 19.
Last year, the Department of the Interior held its first offshore wind site auction for sites off Massachusetts and Rhode Island; Deepwater Wind won that auction with a bid of $3.8 million. The second auction, held for Virginia on September 4, covered approximately 112,799 acres about 23.5 nautical miles from the Virginia Beach coastline; Dominion Virginia Power won that auction with a bid of $1.6 million.
The Maryland auction later this month will follow procedures similar to those used in the previous two auctions. Based on previous expressions of interest and qualifications, BOEM has determined that sixteen companies are eligible to bid on the Maryland sites:
- Apex Offshore Maryland, LLC
- Bluewater Wind Maryland LLC
- Convalt Energy LLC
- Dominion Wind Development, LLC
- EDF Renewable Development, Inc.
- Energy Management, Inc.
- Fishermen’s Energy, LLC
- Green Sail Energy LLC
- IBERDROLA RENEWABLES, Inc.
- Maryland Offshore Wind LLC
- Orisol Energy US, Inc.
- RES America Developments Inc.
- SCS Maryland Energy LLC
- Sea Breeze Energy LLC
- Seawind Renewable Energy Corporation LLC
- US Wind Inc.
Offshore wind project developers must coordinate regulatory, financial, and engineering efforts. Securing a site for a project is a major step forward, but is only one of many important steps necessary to build an operating offshore wind project -- something the U.S. still lacks. How much interest will the Maryland auction draw? Who will win the right to lease the two parcels in the Maryland wind energy area, and how much will they pay? Will the auction winners actually build offshore wind projects? Some of these questions will be answered when the auction closes on August 19.
US Department of Interior features energy as a priority
Tuesday, December 3, 2013
The United States Department of the Interior has updated its regulatory priorities for the coming six months, with energy issues featured prominently. The nation's principal steward of federal public lands and resources, the Department manages more than
500 million acres of Federal lands, including 401 park units, 560 wildlife
refuges, and approximately 1.7 billion of submerged offshore acres on the Outer Continental Shelf. These lands and waters are home to significant energy and mineral resources, including renewable energy sources such as solar, wind, and hydropower, as well as oil, gas, coal, and minerals such as uranium. The Interior Department's recently-announced priorities highlight the importance of energy issues in its regulatory agenda for 2014.
Energy issues are not new to the Interior Department. Its mission statement, captioned, "Protecting America’s Great Outdoors and Powering Our Future", reads:
As noted in the Department's statement, under the Obama Administration, the Department has focused on renewable energy issues and has established priorities for environmentally responsible development of renewable energy on public lands and the Outer Continental Shelf. Energy producers and developers are investing in the development of wind farms off the Atlantic seacoast and solar, wind, and geothermal energy facilities throughout the West. The Department announced its intent to continue its intra- and inter-departmental efforts to move forward with the environmentally responsible review and permitting of renewable energy projects on public lands, and to streamline regulatory processes to facilitate the responsible development of these resources.
Like most federal agencies, the Interior Department is organized as a collection of bureaus and offices. These agencies include the Bureau of Land Management, which manages the 245-million-acre National System of Public Lands, located primarily in the western States, including Alaska, and the 700-million-acre subsurface mineral estate located throughout the nation. The Bureau of Land Management's regulatory priorities include creating a competitive process for offering lands for solar and wind energy development. Specifically, the Bureau is proposing competitive bidding for lands within designated solar and wind energy development leasing areas. The proposed rule is designed to enhance BLM's ability to capture fair market value for the use of public lands, ensure fair access to leasing opportunities for renewable energy development, and foster the growth and development of the renewable energy sector of the economy.
If the Bureau of Ocean Energy Management's recent auctions for offshore wind sites on the Outer Continental Shelf are any example, the Bureau of Land Management may soon be holding competitive auctions for land-based renewable energy sites. These auctions will likely seek to balance support for responsible resource development against conservation, as the Department also includes conservation-oriented agencies such as the U.S. Fish and Wildlife Service and the National Park Service.
Yet how these regulatory priorities translate into regulatory action -- and how that regulatory action affects the development of renewable resources -- remains to be seen.
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| The Parker River National Wildlife Refuge, managed by the Department of the Interior's U.S. Fish and Wildlife Service. |
The U.S. Department of the Interior protects America’s natural resources and heritage, honors our cultures and tribal communities, and supplies the energy to power our future.Twice a year, the Interior Department publishes a statement of its regulatory priorities. The most recent statement, issued November 26, features several initiatives designed to promote the development of renewable resources on public lands.
As noted in the Department's statement, under the Obama Administration, the Department has focused on renewable energy issues and has established priorities for environmentally responsible development of renewable energy on public lands and the Outer Continental Shelf. Energy producers and developers are investing in the development of wind farms off the Atlantic seacoast and solar, wind, and geothermal energy facilities throughout the West. The Department announced its intent to continue its intra- and inter-departmental efforts to move forward with the environmentally responsible review and permitting of renewable energy projects on public lands, and to streamline regulatory processes to facilitate the responsible development of these resources.
Like most federal agencies, the Interior Department is organized as a collection of bureaus and offices. These agencies include the Bureau of Land Management, which manages the 245-million-acre National System of Public Lands, located primarily in the western States, including Alaska, and the 700-million-acre subsurface mineral estate located throughout the nation. The Bureau of Land Management's regulatory priorities include creating a competitive process for offering lands for solar and wind energy development. Specifically, the Bureau is proposing competitive bidding for lands within designated solar and wind energy development leasing areas. The proposed rule is designed to enhance BLM's ability to capture fair market value for the use of public lands, ensure fair access to leasing opportunities for renewable energy development, and foster the growth and development of the renewable energy sector of the economy.
If the Bureau of Ocean Energy Management's recent auctions for offshore wind sites on the Outer Continental Shelf are any example, the Bureau of Land Management may soon be holding competitive auctions for land-based renewable energy sites. These auctions will likely seek to balance support for responsible resource development against conservation, as the Department also includes conservation-oriented agencies such as the U.S. Fish and Wildlife Service and the National Park Service.
Yet how these regulatory priorities translate into regulatory action -- and how that regulatory action affects the development of renewable resources -- remains to be seen.
US holds first offshore wind site lease auction
Thursday, August 1, 2013
Yesterday the U.S. Department of the Interior held its first competitive lease sale for renewable energy on the Outer Continental Shelf. With a total bid of about $3.8 million, Deepwater Wind New England, LLC won the rights to lease two parcels covering 164,750 acres offshore Rhode Island and Massachusetts. What do the auction results mean?
Consistent with President Obama's climate action plan, the Interior Department is promoting the use of federal lands for the production of renewable electricity. Yesterday's auction represents the first competitive auction for leases for offshore wind sites in federal waters. Following significant stakeholder process, the Interior Department identified and refined the parcels off Rhode Island and Massachusetts, and solicited interest in leasing sites. In June, the Interior Department announced that nine companies were legally, technically, and financially qualified to participate in the auction.
The auction took place in two phases in late July. First, a panel met to consider non-monetary factors, including whether any bidders held agreements that could make their project a more realistic success. For example, bidders demonstrating a power purchase agreement or joint development agreement could score bonus points enabling them to compete against higher monetary bids. Deepwater Wind's joint development agreement with the State of Rhode Island thus gave it an advantage in the second round held on July 31. This round took a more traditional auction format, with bidders placing a series of increasing bids until only one bidder remained for each parcel.
Three bidders participated in the auction: Deepwater Wind New England, LLC, Sea Breeze Energy, LLC, and US Wind Inc. After 4 rounds, Deepwater Wind had won the south parcel for $94,153, and only one other company remained in the competition for the north parcel. By round 11, Deepwater Wind had won the north parcel with a bid of $3,744,135.
With the auction completed, Deepwater Wind has 10 days to execute the lease agreements. Its first rent under the leases will be due in 45 days. Lease fees for the sites will be charged at $3 per acre, and if Deepwater Wind develops an operating project, it will also pay an annual fee roughly equal to 2% of its wholesale energy market revenues.
Building on this first auction, the Department of the Interior plans to hold a second auction for sites off Virginia in September. Eight bidders have been deemed qualified to participate in the Virginia auction. How many bidders will actually participate in the auction? How much competitive interest will arise? For what price will the parcels' lease rights sell? Will the leases - whether off Rhode Island and Massachusetts, or off Virginia - lead to operating offshore wind projects? Time will tell how the 2013 offshore wind lease auctions affect U.S. energy development.
Consistent with President Obama's climate action plan, the Interior Department is promoting the use of federal lands for the production of renewable electricity. Yesterday's auction represents the first competitive auction for leases for offshore wind sites in federal waters. Following significant stakeholder process, the Interior Department identified and refined the parcels off Rhode Island and Massachusetts, and solicited interest in leasing sites. In June, the Interior Department announced that nine companies were legally, technically, and financially qualified to participate in the auction.
The auction took place in two phases in late July. First, a panel met to consider non-monetary factors, including whether any bidders held agreements that could make their project a more realistic success. For example, bidders demonstrating a power purchase agreement or joint development agreement could score bonus points enabling them to compete against higher monetary bids. Deepwater Wind's joint development agreement with the State of Rhode Island thus gave it an advantage in the second round held on July 31. This round took a more traditional auction format, with bidders placing a series of increasing bids until only one bidder remained for each parcel.
Three bidders participated in the auction: Deepwater Wind New England, LLC, Sea Breeze Energy, LLC, and US Wind Inc. After 4 rounds, Deepwater Wind had won the south parcel for $94,153, and only one other company remained in the competition for the north parcel. By round 11, Deepwater Wind had won the north parcel with a bid of $3,744,135.
With the auction completed, Deepwater Wind has 10 days to execute the lease agreements. Its first rent under the leases will be due in 45 days. Lease fees for the sites will be charged at $3 per acre, and if Deepwater Wind develops an operating project, it will also pay an annual fee roughly equal to 2% of its wholesale energy market revenues.
Building on this first auction, the Department of the Interior plans to hold a second auction for sites off Virginia in September. Eight bidders have been deemed qualified to participate in the Virginia auction. How many bidders will actually participate in the auction? How much competitive interest will arise? For what price will the parcels' lease rights sell? Will the leases - whether off Rhode Island and Massachusetts, or off Virginia - lead to operating offshore wind projects? Time will tell how the 2013 offshore wind lease auctions affect U.S. energy development.
Election 2012 and energy recap
Wednesday, November 7, 2012
With yesterday's general election behind us, people across the United States are considering its impact on energy policy. From President Obama's retention of the White House to state elections and ballot measures, voters have reshaped the energy landscape. Here are some highlights:
- President Obama wins reelection. Obama's win may mean "more of the same" when it comes to energy policy. President Obama has indicated support for increased domestic production of natural gas and oil, as well as for programs to encourage the development of renewable electric generation. While the U.S. Department of Energy remains under scrutiny for loan guarantees it offered companies like Solyndra, Obama's reelection likely means that the Department of Energy will not face as strong a shakeup as it would have under a President Romney. Still, many observers expect Secretary of Energy Steven Chu to be replaced. The U.S. Environmental Protection Agency will likely continue to develop regulations covering energy-related emissions such as ozone, coal ash, and sulfur from fuels. These regulations have effectively been on hold pending the election. EPA Administrator Lisa Jackson may continue to lead the agency. Likewise, Interior Secretary Ken Salazar has indicated his desire to remain Secretary of the Interior; in Obama's second term, the Department of the Interior is likely to continue its current course in leasing land for oil and gas production as well as for renewable energy production.
- Congress remains divided. At the federal level, Democrats held onto control of the Senate, while Republicans retained control in the House. The chambers' partisan nature may lead to gridlock, or at least to consensus-based, relatively moderate measures as the only kind of legislation likely to meet the approval of both chambers of Congress.
- Michigan rejects constitutional amendment on renewable energy. Michigan voters rejected a proposed amendment to the state constitution that would have increased the amount of renewable energy that utilities must buy to serve their customers. Proposition 3 would have required electric utilities to generate at least 25 percent of their annual retail sales of electricity from renewable energy sources by 2025. Only 36% voted in favor of the measure to increase the renewable portfolio standard, meaning the RPS initiative failed.
Plan for solar on U.S. public lands advances
Monday, October 15, 2012
The U.S. Department of the Interior has finalized its general assessment of the environmental impacts of developing solar electric generation on public lands in six western states. Last Friday's issuance of a Programmatic Environmental Impact Statement (PEIS) will expedite the permitting of solar energy projects in designated solar energy zones on federal land.
Part of the Obama administration's plan to encourage utility-scale solar energy development on federal lands, the finalization of the record of decision for the PEIS established an initial set of 17 Solar Energy Zones
(SEZs) in Arizona, California, Colorado, Nevada, New Mexico and
Utah. (Refer to DOI's map to see the general location of the zones.)
These initial 17 zones cover about 285,000 acres of public lands, and were designated based on factors including environmental suitability and access to transmission lines. The Interior Department projects that if fully built out, the designated zones could be home to up to 23,700 megawatts of solar energy, an amount sufficient to power about 7 million homes.
The approved solar plan also allows a case-by-case evaluation of solar projects on another 19 million acres in “variance” areas outside the designated zones. At the same time, the plan excludes almost 79 million acres deemed "inappropriate for solar development based on currently available information."
Notably, the PEIS does not pre-approve any specific plan. Each project proposed in the designated zones will still require its own environmental review and other permitting. Nevertheless, the solar plan may facilitate significant development of solar energy projects on public lands in the western United States.
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| A view of the back a solar panel on public land in the Utah desert. |
These initial 17 zones cover about 285,000 acres of public lands, and were designated based on factors including environmental suitability and access to transmission lines. The Interior Department projects that if fully built out, the designated zones could be home to up to 23,700 megawatts of solar energy, an amount sufficient to power about 7 million homes.
The approved solar plan also allows a case-by-case evaluation of solar projects on another 19 million acres in “variance” areas outside the designated zones. At the same time, the plan excludes almost 79 million acres deemed "inappropriate for solar development based on currently available information."
Notably, the PEIS does not pre-approve any specific plan. Each project proposed in the designated zones will still require its own environmental review and other permitting. Nevertheless, the solar plan may facilitate significant development of solar energy projects on public lands in the western United States.
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