Lasting almost seven hours across 18 rounds, the auction was significantly faster than its predecessor for NY Bight.
The two areas, OCS-A 0545 and OCS-A 0546 were finally awarded to TotalEnergies and Duke Energy Corporation for $160 million and $155 million respectively (or $719k and $694k per m2).
New York seabed areas leased at a premium
An immediate reaction to the auction results was a focus on how much lower these auction prices were compared to the NY Bight auction held earlier this year, where leases were awarded from $1.7 to $2.7 million per km2.
Read more: Six developers take New York Bight lease areas for a total $4.4 billion
Does this mean NY Bight was merely an overzealous blip? It may help to give the situation some context.
First, Carolina Long Bay call areas are some of the most remote in the US East Coast (USEC) offshore wind farm hub. It is located over 1,000 km (~580 NM) south of the most advanced projects in the region, making it a more expensive consideration from a soft costs perspective.
Secondly, looking at pre-2018 lease auctions of US East Coast, New York call area OCS-A 0512 fetched $132k/km2. - one to two orders of magnitude higher than its peers – indicating that New York seabed areas were leased for a premium over other locations even in the early stages.
Nevertheless, #CLB2022 has still managed to fetch 2.5x the 2018 Massachusetts lease, and almost 40x the 2017 North Carolina lease (won by Avangrid Renewables). This is undoubtedly an optimistic precedent for the two regions, as they prepare for future leasing rounds of almost 7,000 sq. km. of additional call areas.
To find out more about this topic, and how Spinergie’s solutions can help you optimize your operations and reduce your carbon footprint, schedule a demo with our team.
