(Bloomberg)—The US is planning to auction in December leases for offshore wind farms in California waters, the first off the Pacific Coast, which will require a new, more expensive turbine technology.
The US Interior Department said Tuesday it will auction five leases spanning 373,000 acres (151,000 hectares) off central and northern California, enough space to install turbines with more than 4.5 gigawatts of capacity.
The Biden administration is seeking to promote offshore wind development near the near large, power-hungry cities on the West Coast, but the region’s deep waters will require floating turbines, a more expensive design that hasn’t been deployed commercially in the US.
“We are taking another step toward unlocking the immense offshore wind energy potential off our nation’s west coast,” Interior Secretary Deb Haaland said in a statement.
President Joe Biden has set a goal of deploying 30 gigawatts of offshore wind by 2030, with lease sales on almost every coastline. Developers are already pursuing numerous projects in the Atlantic, where the waters are shallow enough to install conventional turbines on the seabed.
Forty-three companies, including Avangrid Renewables LLC, BP US Offshore Wind Energy LLC, EDF Renewables Development Inc. and Shell New Energies US LLC, have registered as potential bidders in the Dec. 6 auction.
The plans track a May proposal by the agency, with the Interior Department offering incentives for developers that support local workforce training and enter into project labor agreements. The work will need to be balanced with US Navy training activities, and the agency has put developers on notice that the potential designation of national marine sanctuaries may affect their plans.
Coastal wind projects are expected to help California meet its goal of a zero-emission grid by 2045. Offshore wind development is expected to spur new construction centers and supply chains in the region, as is already happening on the Atlantic coast.
The lease sale “puts California on a path as a global hub for offshore wind technology that will foster thousands of good-paying American maritime and manufacturing jobs while boosting the domestic offshore wind supply chain,” JC Sandberg, interim chief executive officer of the American Clean Power Association, said in a statement.
Leases will not be issued immediately after the sale to comply with requirements under the just-enacted Inflation Reduction Act that tie offshore wind awards to the sale of oil and natural gas drilling rights in US coastal waters. An upcoming sale of oil and gas leases in the Gulf of Mexico is required by March 31 and the wind leases are set to be formally awarded afterward.
--With assistance from Liam Denning.
© 2022 Bloomberg L.P.
