Feds Greenlight NYS Offshore Wind Power Lease Auction

In the latest development in a watershed year for offshore wind power in the United States, the U.S. Department of the Interior’s Bureau of Ocean Energy Management (BOEM) today announced it will move ahead with a Dec. 15 auction for leasing rights to an almost 80,000-acre “wind energy area” in federal waters 11 miles off the Rockaways and Long Island, New York. "The development of Long Island's vast offshore wind resources will further strengthen New York's place at the forefront of the clean energy revolution," New York's Governor Andrew Cuomo noted in response to the auction announcement.

The announcement by BOEM Director Abby Hopper took place on an American Wind Energy Association boat tour of the Block Island Wind Farm off Rhode Island, the first U.S. offshore wind project, which is slated to begin producing electricity next month.

Today’s announcement is the latest in a string of important developments for the clean power technology this year. Around the same time that Deepwater Wind completed construction of the Block Island Wind Farm this summer, the Commonwealth of Massachusetts enacted legislation to bring 1,600 megawatts of offshore wind power online in about a decade. Earlier this fall, the U.S. Departments of Interior and Energy rolled out a new national offshore wind power strategy. And initial plans are now underway to start the process of developing offshore wind power off the California and Hawaii coasts. BOEM Director Hopper and Interior Secretary Sally Jewell deserve our thanks for their diligent work promoting this transformative, pollution-free technology.

Today’s announcement also brings New York State one crucial step closer to realizing its tremendous offshore wind power potential—enough to power 15 million homes, according to the State’s recent Blueprint for the New York State Offshore Wind Power Master Plan. Opening the area to offshore wind power is important to helping New York State meet its appropriately ambitious and nation-leading clean energy goals. New York officials have explained that scaling up offshore wind is crucial to the State’s new requirement to get 50 percent of our electricity from renewable resources like offshore wind by 2030.

Offshore wind power will have many other benefits in New York, too: It can bring increased reliability to our sometimes overstressed downstate electric grid; improve our public health by reducing the need to generate electricity with polluting fossil fuels; cut our impact on the climate; and create thousands of good-paying, local jobs.

The BOEM auction will also allow the State’s clean energy agency, the New York State Energy Research and Development Authority (NYSERDA), an opportunity to pioneer a new model for scaling up offshore wind power that other states can soon follow, by bidding into the auction in an effort to facilitate project development and reduce overall costs. NYSERDA announced earlier that it intended to bid on the lease and if it wins the auction, the clean energy agency aims to cut the cost of offshore wind power development by avoiding possible complications that can stall projects.

These difficulties can result from the fact that both the federal and state governments are involved in the siting and procurement process, with the federal government offering leases and state governments acting to allow or require utilities to purchase offshore wind power, often through a competitive process that results in a long-term contract. But because there is no guarantee that the winner of a federal lease will be selected for a long-term contract, complications can ensue. Conversely, if a long-term contract is approved by a state in advance of a federal lease sale, there’s no guarantee that the winner of the contract will also be granted the federal lease.

If NYSERDA wins this lease, it will do the initial site assessments and studies itself, and then, by running its own competitive process that will result in a power purchase mechanism, it will choose a developer to build and operate the project. In doing this, it can avoid these possible pitfalls and also ensure that there is robust competition for the right to develop the site. This strategy has worked in Europe to reduce the costs of offshore wind power.

NYSERDA, of course, is not the only party involved in the auction. There are currently 14 qualified bidders, including many of the big European offshore wind power developers. While NYSERDA's leadership would offer many advantages, a successful offshore wind project could also be produced in many different ways, including through development by a private developer.

The New York lease auction announced today is only one important step in developing responsibly sited wind power off New York’s coast. It is just the start of the journey. Governor Cuomo is supporting a 90-megawatt offshore wind power project to be sited 30 miles east of Montauk; the Long Island Power Authority will likely vote on that project later this year. And NYSERDA is working on an Offshore Wind Master Plan for New York, which will provide further detail on the scope and ambition of New York’s offshore wind plans—including other areas for potential offshore wind power development—and is creating an action plan for getting us there.

NRDC, together with the New York Offshore Wind Alliance, is pushing for New York to develop 5,000 megawatts of offshore wind power by 2030. And we will continue to work to make sure that offshore wind power is developed in ways that will protect marine ecosystems and wildlife, building on our work with offshore wind power developers like Deepwater Wind to protect the North Atlantic right whale as projects move forward.

Let’s celebrate today’s announcement by the Department of the Interior and BOEM, as well as New York's continued forward movement on offshore wind power and all forms of clean energy. In a watershed year, this is another great step forward for clean energy in New York and beyond.