The US’s first Atlantic floating offshore wind lease sale raises $21.9 million

The Atlantic coast’s first floating offshore wind lease sale in the Gulf of Maine resulted in two provisional winners and $21.9 million in winning bids, with four lease areas awarded.

The first Atlantic floating offshore wind lease sale

The Biden-Harris administration announced that Avangrid Renewables and Invenergy NE Offshore Wind emerged as the winners after one round of bidding. Avangrid secured two leases for a total of $11.17 million – these areas encompass nearly 223,500 acres and are located around 29.5 nautical miles off the coast of Massachusetts. They can potentially deliver around 3 gigawatts (GW) of clean energy to the New England region.

Invenergy also obtained two lease areas, totaling just over 215,600 acres, with winning bids amounting to $10.78 million. One area is about 46 nautical miles from Maine, while the other is 21.6 nautical miles from Massachusetts. Together, these areas have the potential to supply renewable energy to more than 2.3 million homes.

Avangrid’s portfolio on the East Coast has now expanded significantly, with over 5 GW of offshore wind capacity planned – enough to power more than 2 million households. The company is involved in projects such as Vineyard Wind 1, New England Wind 1 and 2, and Kitty Hawk Wind South. With these new leases, Avangrid now holds the largest offshore wind development portfolio in the Northeast region.

As for getting those floating wind turbines out in the Atlantic, Avangrid asserts that it’s positioned to leverage the global expertise of its parent company, Iberdrola, which is pioneering floating offshore wind in Europe.

The Gulf of Maine wind lease sale is part of the Biden-Harris administration’s initiative to deploy 30 GW of offshore wind energy capacity by 2030 and 15 GW of floating offshore wind by 2035. Since taking office, the administration has approved 10 commercial offshore wind projects – starting from zero – that together could power more than 5 million homes. It has also conducted six offshore wind lease auctions, including the first-ever for the Pacific and Gulf Coasts.

Liz Burdock, CEO of Oceantic Network, stated: “Today’s successful auction demonstrates that offshore wind will continue to play a leading role in the Northeast’s energy future. These lease areas will deliver well-paying, local jobs, and drive significant investment in manufacturing facilities, ports, and transmission development. Despite the general uncertainty around the upcoming presidential election, this is a vote of confidence for an American industry that has already received nearly $3 billion of new supply chain investment in the first nine months of 2024.”

Electrek’s Take

When it comes to the bigger offshore wind picture, Electrek reported last month that the global wind turbine order intake reached new highs in the first half of 2024, with 91.2 GW of activity, a 23% increase year-over-year, thanks to the Asia-Pacific region, according to analysis from Wood Mackenzie.

Global onshore wind order intake activity increased in the first half of 2024, but the offshore sector struggled, with order intake decreasing 38% year-over-year through the first half (-4.1 GW), as challenging project economics have curbed the market.

Luke Lewandowski, vice president, global renewables research at Wood Mackenzie, noted that “the offshore market has almost 30 GW of conditional orders globally, 21 GW of which are for projects in Europe and the US, but challenging economics continue to delay conversion into firm orders.”

So today’s auction announcement is historic – putting floating offshore wind in the Gulf of Maine was only a concept four years ago. However, only four of the eight areas attracted high bids, which isn’t surprising considering the current challenges facing US offshore wind and the tight election, with one candidate threatening to undermine the industry.

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