Two Central Atlantic offshore wind areas drew a combined $92.65 million in high bids Aug. 14 during the region’s first federal wind lease auction in a decade. 

The U.S. Bureau of Ocean Energy Management declared Equinor Wind and Dominion Energy the provisional winners among six bidders for the two leases off the Delaware and Virginia coastlines. 

Equinor beat out other bidders in multiple rounds of bidding with a $75 million final offer to lease OCS-A 0557. The Norway-based energy company has a worldwide offshore wind portfolio that includes Empire Wind off the New York coast. 

OCS-A 0557 totals 101,443 acres with a potential installed generation capacity of 1.2 GW to 2.3 GW. 

Dominion, bidding as Virginia Electric and Power Co., submitted the only bid to lease OCS-A 0558 and offered the minimum price: $17.65 million. Dominion currently is building Coastal Virginia Offshore Wind, a 2.6-GW project that is the largest yet approved for construction in U.S. waters. 

OCS-A 0558 totals 176,505 acres, with a potential installed generation capacity of 2.1 GW to 4.0 GW. 

In a news release, Interior Secretary Deb Haaland noted how far offshore wind has come: 

“At the start of the administration, our nation had approved zero offshore wind energy projects. Today, we have nine — enough to power nearly 5 million homes. This is what developing a clean energy transition looks like.” 

The U.S. offshore wind sector has grown greatly during the Biden administration yet has struggled mightily with local and global headwinds. 

The 2024 Central Atlantic auction attracted far higher bids than the 2023 Gulf of Mexico auction ($5.6 million) but far lower than BOEM’s 2022 auctions in the New York Bight ($4.37 billion), North Carolina ($315 million) and California ($757 million). 

BOEM plans offshore wind lease auctions this year off the Oregon coast and in the Gulf of Maine. It canceled a planned Gulf of Mexico auction for lack of competitive interest. 

Dominion provisionally won the OCS-A 0558 lease without competition at a substantially lower price than OCS-A 0557 commanded, even though OCS-A 0558 is substantially larger and potentially can site many more wind turbines. 

The final sale notice flagged some potential complicating factors for wind energy development in OCS-A 0558, including NASA launch operations and extensive military activity in the region.  

BOEM warned prospective bidders, for example, that conflicts with the U.S. Navy’s advanced radar system at Naval Air Station Patuxent River could force up to 1,750 hours of wind turbine curtailment per year. 

A third wind energy area in the region presents even more potential conflicts and was removed from consideration for this auction.  

A Dominion spokesperson told NetZero Insider it’s too early to say how these restrictions would affect the utility’s planning but that potential future wind energy development would engage all stakeholders. 

OCS-A 0558 is 35 nautical miles east of the mouth of the Chesapeake Bay, directly east of and contiguous to OCS-A 0483, which Dominion acquired for $1.6 million in a 2013 auction. It is building Coastal Virginia Offshore Wind (CVOW) there. 

Nearby, off the northernmost coast of North Carolina, Dominion has agreed to buy OCS-A 0559 from Avangrid, which had planned to develop it as Kitty Hawk North and ran into local opposition with its plans for an export cable making landfall in Virginia Beach. 

If the sale is finalized, Dominion may develop the area as CVOW-South. (See Dominion to Buy Kitty Hawk North Offshore Wind Lease.) 

A proposal was floated this year to bring competition to offshore wind development in Virginia waters. Senate Bill 578 called for a competitive procurement process in which Dominion could submit bids but not evaluate them or select awardees. The measure was pushed back to the 2025 legislative session. 

The provisional winners were happy about the result of the Central Atlantic auction. 

Molly Morris, president of Equinor Renewables Americas, said in a news release, “Equinor’s interest in this auction is consistent with our approach to pursue attractive offshore wind opportunities in the United States. The Central Atlantic region has … rapidly growing demand for electricity, with widespread support for adding renewable sources of energy into the power mix.” 

Dominion said the move would expand options for an all-of-the-above approach to meeting unprecedented electric demand in Virginia. “Winning this lease area gives us another low-cost option to meet that growing demand while providing our customers with reliable, affordable and increasing clean energy,” CEO Robert Blue said. 

Trade association Oceantic Network hailed the auction results and cast an optimistic eye to the future, noting there is bipartisan support in the region for offshore wind even as wind energy foe Donald Trump fights to return to the White House.

“Today’s successful auction demonstrates that offshore wind will continue to play a leading role in the region’s energy future,” Oceantic CEO Liz Burdock said. “The resulting leases will strengthen an emerging manufacturing hub in the mid-Atlantic, creating a dependable pipeline of contracts well into the next decade. Despite the general uncertainty around the upcoming presidential election, this is a vote of confidence for an American industry that has already received more than $2 billion of new supply chain investment in the first half of 2024.” 

The Mid-Atlantic Renewable Energy Coalition, a nonprofit advocacy group, hailed the auction results for their impact on the region. Executive Director Evan Vaughan said, “Today’s auction for the right to develop offshore wind farms off the coast of Mid-Atlantic states makes clear that a combination of state policies in Maryland, Delaware, New Jersey and Virginia, along with rising electricity demand, are attracting major interest from our growing industry. MAREC Action congratulates Equinor and Virginia Electric and Power Co. on their winning bids today — consumers will be the ultimate winners of this new source of reliable clean energy.”