Offshore Wind

Biden Administration Announces First Offshore Wind Lease Sales for Gulf of Mexico

The Biden administration on Feb. 22 announced the first-ever lease sale for offshore wind power development in the Gulf of Mexico. The Dept. of the Interior, through its Bureau of Ocean Energy Management (BOEM), said it would open more than 300,000 acres in the Gulf, an area that long has been a major part of U.S. exploration for crude oil and natural gas.

Wednesday’s announcement continues the administration’s push for offshore wind farms off the nation’s coastlines. The U.S. has trailed Europe and other areas in the development of offshore wind; a major project off the Iberian Peninsula was announced earlier this week. Foreign companies are investing in U.S. offshore wind as they look to expand their global footprints at a time when industry analysts say U.S. development is poised for major growth.

“America’s clean energy transition is happening right here and now. At the Department, we are taking action to jump-start our offshore wind industry and harness American innovation to deliver reliable, affordable power to homes and businesses,” Interior Secretary Deb Haaland said in a statement. “There is no time to waste in making bold investments to address the climate crisis, and building a strong domestic offshore wind industry is key to meeting that challenge head on.”

The BOEM has proposed lease sales in two designated wind energy areas, or WEAs, off Louisiana and Texas. They include a proposed sale notice for a 102,480-acre area off Lake Charles, Louisiana, and two areas near Galveston, Texas, of 102,480 and 96,786 acres.

Elizabeth Klein, director of the BOEM, in a statement said her group “is committed to ensuring any offshore wind activities are done in a manner that avoids or minimizes potential impacts to the ocean and ocean users.” The Proposed Sale Notice issued Wednesday initiates a 60-day public comment period for the lease sale.

“Today’s announcement comes after years of engagement with Tribes, other government agencies, ocean users and stakeholders, and this proposed sale notice provides another opportunity for them to weigh in on potential offshore wind leasing in the Gulf of Mexico,” said Klein.

30 GW by 2030

The Biden administration has a goal of building at least 30 GW of offshore wind power generation capacity by 2030. It’s part of the administration’s broader goal of reducing U.S. carbon emissions by at least 50% by the end of the decade. The administration also has said it wants to deploy another 15 GW of offshore wind power from floating turbines by 2035. Floating turbines enable wind farm deployments in deeper water.

Luke Metzger, executive director of Environment Texas, in a statement to POWER said, “Offshore wind will be a great complement to Texas’ onshore renewable energy resources. With strong, consistent winds in the Gulf, offshore wind will help reduce pollution and strengthen our electric grid. From building ships big enough to transport wind turbine blades to boasting a workforce experienced in working offshore, Texas is well-positioned to be a leader in the offshore wind industry.”

Government studies have shown that the Gulf of Mexico’s shallow waters, and its proximity to oil and gas infrastructure, make it a promising area for offshore wind development. The National Ocean Industries Association (NOIA), a trade group for offshore energy businesses, said offshore wind would complement the Gulf’s existing energy industry.

“The energy, jobs and investment opportunities from Gulf of Mexico offshore wind will be additive to the incredible benefits the offshore oil and gas sector provides our nation,” NOIA President Erik Milito said in a statement.

Lisa Frank, executive director of the Washington (D.C.) Legislative Office of Environment America, in a statement emailed to POWER after Wednesday’s announcement, said, “We have the power to run our lives entirely on clean, renewable energy from the wind and sun, and these actions by the Biden administration move us closer to that brighter future. For more than a decade, East Coast states have led the way in setting ambitious offshore wind goals, and now, they have strong partners in President Biden and his administration, Governor Gavin Newsom of California and Governor John Bel Edwards of Louisiana. We thank these leaders for going big on offshore wind to help us secure clean, abundant energy and reduce pollution.”

“Today’s announcement is another significant milestone in the development of domestic offshore wind production. This proposed lease sale will continue the legacy of energy production in the Gulf of Mexico, providing Americans with an affordable clean energy supply. It will also help secure our nation’s energy independence while reducing costs for consumers,” said Josh Kaplowitz, American Clean Power’s (ACP’s) Vice President for Offshore Wind, in a statement provided to POWER. “By harnessing our abundance of renewable natural resources, these projects will unleash economic growth here at home and create good paying jobs. ACP applauds Interior Secretary Haaland and BOEM and looks forward to partnering with them to meet the ambitious but achievable goal of deploying 30 GW of offshore wind by 2030.”

Earlier Lease Sales

Wednesday’s announcement of a lease sale in the Gulf comes after earlier announcements of lease sales of the U.S. East and West coasts. The first auction for leases off the Pacific Coast, held in December of last year, brought in more than $757 million. A lease sale for the New York Bight region off the East Coast, held in February of last year, pulled in $4.37 billion. Several projects already are being developed along the East Coast, home to the nation’s first-ever wind power development, the Block Island project off the coast of Rhode Island.

Environment California State Director Laura Deehan in an statement to POWER said, “California is poised to go big on offshore wind and today’s announcement brings us closer to a future where we put our powerful coastal winds to work cutting pollution from homes, cars and industry and reaching our goal of 100% clean energy.”

The Gulf of Mexico announcement comes on the heels of the 2023 U.S. Offshore Wind Market Report, produced by the Business Network for Offshore Wind. That report, made public this week, said that state demand for offshore wind almost doubled in 2022. Contracts for offshore wind development rose 36% over the past year, with most of those contracts going to U.S.-based project developers.

Other key findings from the report include:

  • Over the year, 664 new organizations registered with the Business Network’s Supply Chain Connect registry, representing a 27% increase.
  • Long-term state offshore wind targets increased 79% last year. California called for 25 GW of offshore wind generation, and Louisiana, New Jersey, and Rhode Island announced new state goals.
  • The U.S. offshore wind market saw $9.8 billion in new investments in 2022, more than triple the prior year. Growth was primarily driven by lease auction fees, though more than $4.4 billion was directed to port infrastructure, supply chain development, and transmission. The Business Network has identified $17 billion in new investments driven by offshore wind activity in the United States since 2014.
  • The Biden-Harris administration is on track to hit self-defined targets to lease seven new areas and perform 16 project environmental reviews. However, currently announced completion dates suggest the industry will fall short of installing 30 GW of offshore wind by 2030.

“The advancement of an offshore wind lease sale in the Gulf of Mexico is a game-changer,” said Liz Burdock, founder and CEO of the Business Network for Offshore Wind, in a statement provided to POWER. “Gulf companies are already instrumental in the development of the U.S. market and by opening new lease areas on their doorstep we will leverage our unique domestic expertise even further. The result will be industry-wide innovations making offshore wind development more efficient and less expensive while maintaining strong safety and environmental protections and leading to substantial export opportunities for American businesses.

“The Network looks forward to BOEM’s continued work advancing the lease areas and encourage the agency to maintain the maximum potential developable acreage while it coordinates with other ocean users,” Burdock said.

Darrell Proctor is a senior associate editor for POWER (@POWERmagazine).

SHARE this article