Interior Department holds first auction for offshore wind in the Gulf of Mexico

The U.S. Department of the Interior held the first-ever offshore wind energy auction for the Gulf of Mexico region this week.

The auction resulted in one lease area receiving a high bid of $5.6 million. It came from RWE Offshore US Gulf, LLC, which won the Lake Charles Lease Area. This lease area has the potential to generate approximately 1.24 gigawatts of offshore wind energy capacity and power nearly 435,400 homes with renewable energy.

“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,” Bureau of Ocean Energy Management (BOEM) Director Elizabeth Klein said. “The Lake Charles Lease Area will have the potential to generate enough electricity to power about 435,400 homes and create hundreds of jobs.” 

BOEM’s lease sale offered two areas offshore Galveston, Texas, one comprising 102,480 acres and the other 96,786 acres, and a third, the 102,480-acre area offshore Lake Charles, Louisiana. The two Galveston lease areas offered today did not receive bids.

RWE Offshore US Gulf, LLC earned a bidding credit equal to 20 percent of the cash bid to bidders who commit to supporting workforce training programs and developing a domestic supply chain for the offshore wind energy industry. It also earned a credit equal to 10 percent of the cash bid to bidders for establishing and contributing to a fisheries compensatory mitigation fund or contributing to an existing fund to mitigate potential negative impacts to commercial and recreational fisheries caused by offshore wind energy development in the Gulf of Mexico.

These bidding credits will result in over $860,000 in investments for workforce training and a domestic supply chain, and another more than $430,000 for fisheries compensatory mitigation.

The BOEM also included two lease stipulations, one that encourages project labor agreements and construction efficiency and the other that contributes toward establishing a domestic supply chain. Further, the lessee is required to engage with Tribes, ocean users and local communities that may be affected by lease activities. The engagement activities must be routinely reported to BOEM. The idea is to promote offshore wind energy development in a way that coexists with other ocean uses, addresses potential impacts and benefits, and protects the ocean environment.

“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,” Interior Secretary Deb Haaland said. “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.”