PORTLAND, Ore. – The first US lease auction to develop commercial-scale floating wind farms off the West Coast’s deep waters drew $757 million in winning bids Wednesday from mostly European firms, in a project watched by other regions and countries that just got their own started plans for floating offshore wind power.
The auction featured five lease areas, two in Northern California and three in Central California, about 25 miles offshore that have the potential to generate 4.5 gigawatts of power, enough for 1.5 million homes. Combined, the lease areas cover 583 square miles (1,510 square kilometers) of the Pacific Ocean.
Winning bids came from Equinor of Norway, Copenhagen Infrastructure Partners of Denmark, RWE AG of Germany, and Ocean Winds, a French-Portuguese joint venture. Invenergy was the only US company with a winning bid.
Offshore wind is well established in the UK and a few other countries, but it’s just starting to pick up off the US coast, and this is the nation’s first foray into floating wind turbines. American auctions so far have been for those anchored to the seabed.
The growth in offshore wind power comes as climate change intensifies and the need for clean energy grows. It is also getting cheaper. The cost of developing offshore wind power has dropped 60% since 2010, according to a July report from the International Renewable Energy Agency. It decreased by 13% in 2021 alone.
The auction brought in less than the $4.37 billion generated by an East Coast offshore wind lease sale earlier this year, which was expected by at least one industry group. Those leases involved turbines fixed to the seabed in shallower water.
Industry insiders say this week’s lower bids are likely due to an immaturity in the West Coast offshore wind market and the fledgling technology involved in anchoring floating wind farms in deep ocean waters. Uncertainties about transmission infrastructure, location and permits also played a role, they said.
“I think there was an awareness of the stage that it is at and (California) is moving into the very things that need to be in place for this to play out,” said am Stern, CEO of Offshore Wind California, a industry trade. cluster.
“New York and New Jersey and the East Coast in general are further along and California will benefit from that work that is taking place on the East Coast, and we may be able to catch up faster because of that.”
Many of the winning companies are already involved in traditional offshore wind off the US East Coast and floating wind farms abroad.
Equinor, which developed the world’s first floating wind farm in 2017 in Scotland and is the largest US offshore wind developer to date, submitted a $130 million bid for a roughly 2-gigawatt lease in Morro Bay, in central California. The leased area has the potential to generate enough power to power some 750,000 homes, the company said.
Similar auctions are in the works off the Oregon coast next year and in the Gulf of Maine in 2024.
President Joe Biden has set himself a goal of deploying 30 gigawatts of offshore wind power by 2030 using traditional fixed offshore technology, enough to power 10 million homes. The administration then announced plans in September to develop floating platforms that could vastly expand offshore wind power in the United States.
The nation’s first offshore wind farm opened off the Rhode Island coast in late 2016, allowing residents of tiny Block Island to shut down five diesel generators. Wind advocates have taken notice, but with five turbines, it’s not on a commercial scale.
AP writer Jennifer McDermott in Providence, Rhode Island, contributed to this report.
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