The Bureau of Ocean Energy Management announced the provisional winners of its first auction for wind leases along the U.S. west coast, receiving bids totaling $757.1 million for five lease areas that total approximately 373,268 acres. The lease areas offshore California have the potential to provide electricity for more than 1.5 million by producing more than 4.5 GW of electricity from floating offshore wind facilities. The December 6-7 auction was the third major U.S. offshore wind lease sale in 2022, and the totals for the Pacific auction exceeded the Atlantic lease sales earlier in the year. BOEM announced the California lease auction in October. (See BOEM Announces First California Offshore Wind Lease Sale.)
The lease areas included three sites for 3 GW of wind energy in the Morro Bay Wind Energy Area (WEA) and two sites for 1.5 GW of wind energy in the Humboldt Wind Energy Area (WEA). California’s steep continental shelf and increased wind speeds make floating turbines the primary technically feasible option along the west coast. More than 40 companies bid for the leases. The auction winners do not have approval to construct wind energy facilities but must first undergoes environmental reviews and project approvals.
The California lease areas part of the Biden administration’s national target of 30 GW of offshore wind by 2030. (see Offshore Wind Makes Initial Advancements in California.) In May 2022, the Department of the Interior issued a proposed offshore wind lease sale off the California coast, three years after BOEM identified three possible offshore wind energy areas on the Outer Continental Shelf off the California coast: Humboldt, Morro Bay, and Diablo Canyon.
Leases and Provisional Winners
Humboldt (OCS-P 0561): RWE Offshore Wind Holdings, LLC is the provisional winner of the 63,338-acre lease with a bid of $157,700,000.
Humboldt (OCS-P 0562): California North Floating, LLC is the provisional winner of the 69,031-acre lease with a bid of $173,800,000.
Morro Bay (OCS-P 0563): Equinor Wind US, LLC is the provisional winner of the 80,062-acre lease with a bid of $130,000,000.
Morro Bay (OCS-P 0564): Central California Offshore Wind, LLC is the provisional winner of the 80,418-acre lease with a bid of $150,300,000.
Morro Bay (OCS-P 0565): Invenergy California Offshore LLC is the provisional winner of the 80,418-acre lease with a bid of $145,300,000.
Credit for Workforce Training and Supply Chain Development
The lease sale included a 20-percent credit for bidders who committed to making financial contributions to programs or initiatives that support workforce training programs or to the development of a U.S. domestic supply chain for the floating offshore wind energy industry.
Credit for Community Benefit Agreements
The auction also included 5 percent credits for bidders who committed to entering community benefit agreements (CBAs). The first type of CBA is “with communities, stakeholder groups, or Tribal entities whose use of the lease areas or use of the resources harvested from the lease areas is expected to be impacted by offshore wind development.” The second type of CBA is a General CBA with “communities, Tribes, or stakeholder groups that are expected to be affected by the potential impacts on the marine, coastal or human environment from lease development.”
Communication Requirements
Lessees are required to engage with “Tribes, ocean users, and local communities” that may be affected by their lease activities. This engagement must allow for “early and active information sharing, focused discussion of potential issues, and collaborative identification of solutions.” The engagement activities must be reported to BOEM.