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Winners announced following BOEM’s first floating wind auction for US acreage

The results of the Bureau of Ocean Energy Management (BOEM) auction for five leases over two wind energy areas offshore California, Humboldt in the north and Morro Bay in the south, have been announced.

The winners are well-known players in the energy sector: RWE, Copenhagen Infrastructure Partners (California North Floating), Equinor, OW Ocean Winds (Central California Offshore Wind) and Invenergy LLC. 

The auction racked up $757 million, or an average of $505k per sq. km. The prices fell short of repeating New York Bight's past success of $4.4 billion, where leases were awarded from $1.7 to $2.7 million per sq. km., but exceeded Carolina Long Bay's.

Read more: How the Carolina Long Bay and NY Bight auctions compare and why it matters

Yvan Gelbart, Spinergie's Offshore Wind analyst, said: “The five leases have a water depth ranging between 700 to 1,100 meters and partly overlap the continental slope. This is uncharted waters in the floating wind market, which is still a frontier sector with just 100 MW of global installed capacity in various demo projects. The relatively conservative amount of bids shows developers are treading carefully as numerous challenges lay on the road to building commercial-scale, cost-effective floating wind projects in deeper waters.

“A shift in vessel activity is needed to develop floating projects offshore California. Existing projects used numerous AHTS vessels in the construction phase. Still, just three are currently located in the US west coast region - two being involved in The Ocean Cleanup project.

“In November, the US Bureau of Ocean Energy Management unveiled new wind energy areas off the Atlantic Coast, with ambitious water depths of 1,500 to 2,500 metres in the deeper zones. While one of the main opportunities in the floating wind industry is the ability to use deeper waters the announcement of such depths still surprised the industry. The Central Atlantic Wind Energy Area auction lease is to be opened in 2023 and will be another barometer of the industry's appetite for deep waters.”

The California Pacific Lease Round was the third major offshore wind lease sale in the US this year and the first ever for the Pacific region. 

Read more: Six developers take New York Bight lease areas of a total $4.4 billion 

In the Northern California offshore region, RWE has stated that its winning bid for its 63,338-acre lease (OCS-P 0561) has an estimated capacity of up to 1.6 GW. CIP has stated that its affiliate California North Floating LLC has a potential capacity of up to 1GW at its 69,031-acre lease (OCS-P 0562). 

As for the Central California offshore region, Golden State Wind (a joint venture of Ocean Winds and CPP Investments) has confirmed that its 80,418-acre lease (OCS-P 0564) could accommodate approximately 2GW of offshore wind energy when fully built out and operational. Invenergy, which was also awarded an 80,418-acre lease (OCS-P 0565) has estimated that it will accommodate at least 1.5 GW installation capacity. Finally, Equinor announced that it anticipates its 80,0620-acre lease (OCS-P 0563) has a capacity of around 2GW.

To find out more about this topic, and how Spinergie’s Market Intelligence solution can help you make informed decisions for your upcoming projects, contact us for a demo today.

Header photo: Jan Arne Wod/©Equinor

Yvan Gelbart
Yvan Gelbart
Data Analyst
Published on
December 8, 2022
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