Posted on December 15, 2022
We have our winners!
The Bureau of Ocean Energy Management (BOEM) just announced the provisional winners of the first-ever offshore wind energy lease auction on the West Coast.
California North Floating, LLC, a subsidiary of Copenhagen Infrastructure Partners, and RWE Offshore Wind Holdings, LLC, a German multinational energy company, placed the winning bids for two lease areas in the Humboldt Wind Energy Area (WEA), which spans more than 132,000 acres approximately 20 miles west of Eureka.
When the auction ended just before noon today, the swath of watery real estate went for more than $331.5 million, with California North Floating, LLC bidding $173.8 million for 69,031 acres and RWE Offshore Wind Holdings, LLC bidding $157.7 million for 63,338 acres.
BOEM also auctioned off three leases further south, off Morro Bay. Those leases were awarded to Equinor Wind US, LLC, Central California Offshore Wind, LLC and Invenergy California Offshore, LLC for a total of $425 million.
“The offshore wind project for Humboldt is a game-changer for how California can shift to a more sustainable way to provide critical energy and reliability while fighting against climate change,” Assemblymember Jim Wood said in a prepared statement. “The importance of state and federal agencies investing in this region, and the community benefits that will be gained, can’t be underestimated.”
Today’s lease sale also included a 20 percent credit for bidders who committed to workforce and domestic supply chain investments, as well as a five percent credit for a Community Benefits Agreement (CBA) with “communities, stakeholder groups, or Tribal entities whose use of the lease areas or use of the resources harvested from the lease areas” and five percent credit for a General CBA with “communities, Tribes, or stakeholder groups that are expected to be affected by the potential impacts on the marine, coastal or human environment from lease development,” according to BOEM.
Now that the provisional winners have been announced, BOEM will return the non-winners’ bid deposits and the Department of Justice will initiate an antitrust review of the auction. All winners are considered provisional until they sign the lease, provide financial assurance and pay any outstanding balance of their bid.
As soon as that’s all sorted out, the lease agreement will be executed and the leaseholders will draw up a plan and begin the design phase of the project. A rigorous environmental and public review process will soon follow.
We’re certain that local folks and other governmental agencies will have lots to say about this highly anticipated announcement.