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Dominion and Equinor Win Central Atlantic Wind Leases Paying Total of $93M

offshore wind
Dominion was one of the winner looking to expand on its first project now under construction (Dominion Energy)

Published Aug 14, 2024 3:03 PM by The Maritime Executive

 

The U.S. Department of the Interior is reporting strong interest in its latest offshore wind auction completed yesterday for sites off the Central Atlantic states. A total of six companies participated in the auction for the two sites offered with the winning bids of $92.65 million from Dominion Energy and Equinor.

The Bureau of Ocean Energy Management conducted the auction which was scheduled in June for sites located offshore from Delaware, Maryland, and Virginia. They highlighted that it was the first offshore sale in the region in a decade. Combined the two sites have the potential for an additional 2.2 million homes or the capacity for approximately 6.3 GW according to the Department of the Interior.

Equinor Wind provisionally won a lease for 101,443 acres located approximately 26 nautical miles from Delaware Bay. The company’s winning bid was just over $75 million. Equinor highlights the potential for around 2 GW of power from the lease area.

The second parcel consists of 176,505 acres and is located approximately 35 nautical miles from the entrance of Chesapeake Bay. The winner is Virginia Electric and Power Company (Dominion Energy) but it drew just $17.65 million. BOEM estimates the area could provide between 2.1 and 4 GW of power. The lease area is adjacent and to the east of where the company's 2.6-gigawatt Coastal Virginia Offshore Wind project. Dominion also agreed in July to acquire from Avangrid the 40,000-acre Kitty Hawk Wind North offshore wind lease area, to be renamed CVOW South. It could provide an additional 800 MW.

“Today’s lease sale represents a major milestone in meeting the demand for clean renewable energy along the East Coast,” said Bureau of Ocean Energy Management (BOEM) Director Elizabeth Klein. The bureau is reporting that the sale resulted in over $23 million in bidding credits, including over $11 in investments for workforce training and domestic supply chain, and an additional $11 million for fisheries compensatory mitigation. The terms of the bidding include stipulations for buying U.S. materials and seeking project labor agreements.

They are also highlighting that the federal government has already approved nine commercial-scale offshore wind projects and held five offshore wind lease auctions under the Biden-Harris administration. BOEM also released a schedule for future auctions through 2028 and reports it will continue to work with the Central Atlantic Intergovernmental Renewable Energy Task Force to explore and identify potential additional areas for future wind leasing. Trump, however, has vowed to stop offshore wind energy development if re-elected president.

Today’s auction announcement starts a long-term process for planning and review for the sites. Equinor said in its statement that it would be post-2035 before the site could become operational as part of its long-term commitments.

Work is underway on Equinor’s Empire Wind 1 project for New York, while Dominion Energy highlighted this week that it has completed the installation of 54 monopiles for its Coastal Virginia Offshore Wind project while targeting between 70 and 100 before work pauses at the end of October. 

The industry has come under renewed scrutiny in the weeks since one of the blades fractured at the Vineyard Wind 1 project off the coast of Massachusetts. Work is proceeding on the recovery at the site and the Bureau of Safety and Environmental Enforcement (BSEE) yesterday revised its Suspension Order to enable Vineyard Wind to resume activities including the installation of towers and nacelles, but further blade installation or power production remains suspended at this time while the investigation and inspection of the blades continues.