(Corrects ownership for Mid Atlantic Offshore Wind LCC, paragraph 10)

By Valerie Volcovici

WASHINGTON (Reuters] – The Biden Administration’s auction of offshore wind power rights off New York City and New Jersey at record prices attracted $4.37 Billion from major European energy firms.

This auction began Wednesday afternoon and ended Friday afternoon. It was the first sale of offshore wind leases under President Joe Biden. He sees expansion as an opportunity to combat climate change and create new jobs.

It has established a target to build 30 gigawatts of offshore wind power by 2030. Additionally, several states such as New York and New Jersey have mandated clean power adoption.

Deb Haaland, Interior Secretary said that “This week’s offshore wind sales makes it clear: There is a lot of enthusiasm in the energy sector and we will continue to see this,”

It is a significant step forward in American offshore wind power, which was behind European nations when it comes to developing this technology. There are currently only two offshore wind plants in the United States, located off Rhode Island’s coast and Virginia’s, plus two other commercial-scale projects that were recently approved.

Six leases were offered by the U.S. Bureau of Ocean Energy Management, which monitors federal energy development, on 488,201 acres (1197,568 ha), between New York’s Long Island (New York) and New Jersey (an area called New York Bight).

At the close of the auction the total high-bids for the six blocks had reached $4.37 Billion. This is three times more revenue than all U.S. offshore gas and oil lease auctions in the last five years.

Bight Wind Holdings LLC won the highest bid. This joint venture was formed by RWE (Germany’s largest producer of power) and RWE (Britain). National Grid (LON), who won a single parcel of 125.964 acres for $1.1 million.

Atlantic Shores Offshore Wind Bight LLC won the bid. This joint venture, which is fifty percent Shell (LON?) New Energies US LLC and EDF(PA:) Renewables North America’s parent companies, was another winner.

Another winner was Mid Atlantic Offshore Wind LCC. This is owned and managed by a Copenhagen Infrastructure Partners funds; OW Ocean Winds East LLC. It is a joint venture between Portugal’s EDP Renewables, France’s ENGIE, Attentive Energy LLC, and Invenergy Wind Offshore LLC. BOEM reported.

The National Ocean Industries Association said that the auction showed optimism by offshore wind developers about strong future demand.

Erik Milito (president of NOIA) stated that the record-breaking interest in the New York Bight Lease Sale is a testament to the bright outlook for American offshore wind and the confidence developers have in the strength U.S. offshore winds industry in general.

WINDFALL

Tracey Moriarty spoke for BOEM and said that revenues were also big wins for taxpayers.

“The highest bids will benefit the tax payers because the money incurred will be sent to the U.S. Treasury,” she stated.

It wasn’t immediately obvious how the leasing price would affect the eventual cost of generated power.

American Clean Power Association (a trade association) praised this record-breaking auction, and supported BOEM’s goals to have six additional lease sales by 2024.

Heather Zichal, CEO of Heather Zichal said that she challenged policymakers to give more certainty to the new industry to ensure American citizens benefit from its growth potential and jobs-creating potential.

Some people are opposed to offshore wind development. Biden’s plans have raised concerns from coastal fishermen about potential harm to their livelihoods as well and the value of their property.

BOEM was sued by a group New Jersey residents in January for its plans to lease the New York Bight. This group comes from Long Beach Island and is concerned about possible lost tourism as well as the aesthetic impact of turbines.

The region’s commercial scallop fisherman are concerned that offshore constructions will harm their scallop population and make navigation more difficult.