The U.S. West Coast’s First Floating Offshore Wind Auction Has Generated A Whopping $757M In Bids!

Wednesday marked a historic moment for the United States, as it held its first-ever auction of leases to construct commercial-scale floating wind farms in deep waters off the West Coast. This auction attracted an overwhelming amount of interest; $757 million was earned from mostly European companies! This project has become an eye-opener to other countries and regions just starting their plans concerning floating offshore wind energy production.

The auction included five offshore lease areas in Northern and Central California, located within a 25-mile radius of the coast. These territories can generate up to 4.5 gigawatts of energy – sufficient for 1.5 million households! Altogether, these leased areas encompass the bountiful Pacific Ocean’s 583 square miles (1,510 square kilometers).

After a rigorous competition, Norwegian Equinor and three other international companies – Germany’s RWE Offshore Wind Holdings, Central California Offshore Wind, and California North Floating of Denmark’s Copenhagen Infrastructure Partners, emerged as the successful bidders. Invenergy proudly represented the USA by being America’s sole representative among the winning bidders.

Offshore wind is nothing new in the U.K. and several other nations, but it has only just started to gain traction on America’s coasts – with this project leading the way as its first foray into floating turbines! The U.S. auctions held so far have been strictly for those that are anchored down to the seafloor; however, this innovation will take offshore wind harvesting one step further by eliminating their need!

As climate change continues to be a pressing issue and the need for clean energy increases, offshore wind is emerging as an affordable solution. Its growth has been exponential due to its cost-effectiveness and environmental sustainability. According to the International Renewable Energy Agency, offshore wind power’s costs have decreased a whopping 60% since 2010, and 2021 witnessed an additional 13%.

To the surprise of many, the revenue generated from the auction fell significantly short of expectations at only $4.37 billion. This is far less than what was gathered by an offshore wind lease sale off the East Coast organized earlier this year – a figure that industry groups had predicted would be easily exceeded. These leases involved turbines fixed firmly onto the seafloor in much shallower waters than what was being sold at this particular auction. Analysts in the industry indicate that this week’s lower bids may be a result of the inexperience within the offshore wind market on America’s West Coast, as well as with anchoring floating wind farms out at sea. Additionally, uncertainties concerning transmission systems, siting, and licensing have also been influenced.

The Executive Director of Offshore Wind California, Adam Stern, believes that the state is well-positioned to expand and develop its offshore wind energy sector. Drawing on the progress made by New York, New Jersey, and other East Coast states will prove beneficial for California – so much so that we may even be able to close our current gap faster.

Numerous victorious companies are already partaking in the traditional offshore wind off the Eastern coast of America and floater-based wind farms across foreign waters.

In 2017, Equinor made history by establishing the first-ever floating wind farm in Scotland. They have become the premier U.S. offshore wind developer with a commanding $130 million bid for a 2-gigawatt lease off California’s Morro Bay coast! According to the company, this lease area has the potential to generate enough energy to provide electricity for around 750,000 households.

Following this pattern, an auction will take place off Oregon’s shoreline and the Gulf of Maine by 2024.

President Joe Biden has committed to harvesting 30 gigawatts of energy from offshore wind turbines by 2030, a goal that is enough to electrify 10 million homes. In September, the administration proposed a proposal to construct floating platforms that could drastically enhance offshore wind throughout America. Utilizing traditional fixed offshore technology would be a monumental accomplishment for the nation.

In late 2016, Rhode Island became home to the nation’s first offshore wind farm! This incredible development was a huge source of joy for Block Island residents as they could now shut down their five diesel generators. Though this event certainly caught the attention of many wind advocates, its five turbines don’t constitute commercial-scale operations.

Leave a Comment