Biden admin’s offshore wind leases flop in the Gulf of Mexico

The Biden administration’s Tuesday sale of leases for offshore wind projects in the Gulf of Mexico appears to have flopped, according to data from the Bureau of Ocean Energy Management (BOEM).

The Department of the Interior (DOI) put up three zones totaling about 300,000 acres for sale Tuesday, but only one of the zones received any bidding action from any of the numerous eligible companies that reportedly had interest in placing a bid, BOEM data shows. The two zones off the coast of Galveston, Texas, did not receive a single bid, while the lease area off the coast of Lake Charles, Louisiana, attracted three total bids from two companies.

The apparent lack of interest is a setback for the Biden administration’s offshore wind ambitions, which seeks to have the technology provide enough electricity to power up to 10 million American households by 2030. The lease areas that went up for sale Tuesday could have eventually hosted enough turbines to generate up to 10% of the Biden administration’s 2030 target, but it appears unlikely that offshore wind in the Gulf of Mexico will be able to contribute that much toward the goal, at least for the time being, according to Reuters

“Today’s lease sale represents a significant milestone for reaching the Administration’s goal to deploy 30 gigawatts of offshore wind energy capacity by 2030,” a BOEM spokesperson told the Daily Caller News Foundation. “The Gulf is well-positioned to transition to a renewable energy future, as the region’s existing energy infrastructure, workforce, and businesses expertise in offshore operations can immediately advance and benefit offshore wind development,” the spokesperson continued, adding that “we look forward to holding more offshore wind lease sales in the future.”

Several problems make offshore wind in the Gulf less appealing than other regions. Beyond hurricane risks and inopportune underwater soil, southeastern electricity prices also tend to be lower than those in the Northeast, the leading offshore wind region in the U.S., which means that expensive offshore wind-generated electricity may not be able to effectively compete for contracts with electricity produced by other sources, according to Reuters.

RWE Offshore US Gulf won the Lake Charles lease zone, spending $5.6 million to do so, according to BOEM. The company could eventually generate enough electricity to power less than 450,000 homes, less than half of what the administration may have projected to be possible if all three zones were purchased for development.

The firm’s winning bid stands as the lowest successful bid for a federal offshore wind lease sale since former President Barack Obama was in the White House, according to Reuters.

The White House and DOI did not respond immediately to requests for comment.

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