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In a groundbreaking move that underscores the Biden-Harris administration’s unwavering commitment to clean energy, the Department of the Interior made history today by conducting the first-ever offshore wind energy auction for the Gulf of Mexico region. The auction culminated in a resounding success, with RWE Offshore US Gulf, LLC securing the Lake Charles Lease Area with a staggering high bid of $5.6 million. This pivotal lease area boasts the potential to generate approximately 1.24 gigawatts of offshore wind energy, which could power nearly 435,400 homes with clean, renewable energy.
This auction aligns seamlessly with President Biden’s “Investing in America” agenda, a cornerstone of Bidenomics, which seeks to rejuvenate the American economy from the middle out and from the bottom up. This initiative encompasses the revitalization of national infrastructure, the stimulation of over $500 billion in private sector manufacturing and clean energy investments within the United States, the creation of well-paying jobs, and the establishment of a clean energy economy capable of combatting climate change and fortifying our communities against its impacts.
“The Biden-Harris administration is making once-in-a-generation investments in America’s infrastructure and our clean energy future as we take steps to bring offshore wind energy to additional areas around the country,” declared Secretary Deb Haaland. “I am proud of the hard work being done by the Bureau of Ocean Energy Management and across the Interior Department to deliver on our promises to advance a clean energy economy that will lower energy costs for families and create good-paying jobs as we help tackle the climate crisis.”
BOEM Director Elizabeth Klein echoed these sentiments, noting, “Today’s lease sale represents an important milestone for the Gulf of Mexico region — and for our nation — to transition to a clean energy future. The Lake Charles Lease Area will have the potential to generate enough electricity to power about 435,400 homes and create hundreds of jobs.”
The Biden-Harris administration has indeed ignited the American offshore wind industry, bolstering the nation’s energy security, enhancing the reliability of the power grid, reducing energy costs, and curbing harmful climate pollution. The Department of the Interior has granted approval for the first four commercial-scale offshore wind projects in the nation, hosted four offshore wind lease auctions (including a record-breaking sale offshore New York and the first-ever sales offshore the Pacific and Gulf Coasts), initiated environmental assessments for ten offshore wind projects, and propelled efforts to explore additional Wind Energy Areas in Oregon, the Gulf of Maine, and the Central Atlantic. Notably, the Department has embarked on a path toward union-built projects and the cultivation of a domestic supply chain.
BOEM’s lease sale encompassed two areas offshore Galveston, Texas, one spanning 102,480 acres and another covering 96,786 acres, along with a third 102,480-acre area offshore Lake Charles, Louisiana. Regrettably, the two Galveston lease areas did not attract any bids.
RWE Offshore US Gulf, LLC, the victor of the Lake Charles Lease Area, will receive the following bidding credits:
- A credit equal to 20 percent of the cash bid for supporting workforce training programs and developing a domestic supply chain for the offshore wind energy industry.
- A credit equal to 10 percent of the cash bid for establishing and contributing to a fisheries compensatory mitigation fund or contributing to an existing fund to mitigate potential negative impacts to commercial and for-hire recreational fisheries caused by offshore wind energy development in the Gulf of Mexico.
- These bidding credits translate into more than $860,000 earmarked for workforce training and a domestic supply chain, as well as an additional sum exceeding $430,000 for fisheries compensatory mitigation.
BOEM remains steadfast in its dedication to workforce development and safety, alongside the establishment of a robust domestic supply chain capable of sustaining the U.S. offshore wind energy industry. Consequently, BOEM has incorporated two lease stipulations: one that encourages project labor agreements and construction efficiency, and the other that contributes to the establishment of a domestic supply chain.
Furthermore, the lessee is obligated to engage with Tribes, ocean users, and local communities that may be affected by lease activities, with these engagement efforts requiring routine reporting to BOEM. The primary objective of such engagement is to promote offshore wind energy development harmoniously alongside other ocean uses, address potential impacts and benefits, safeguard the ocean environment, and facilitate our nation’s energy future for generations to come.
