Norway’s Equinor and U.S. power company Dominion Energy have revealed their plans after winning in a recent offshore wind auction in the United States.
Equinor and Dominion are the winning bidders for two lease areas off the coasts of Delaware, Maryland, and Virginia.
The U.S. Interior Department announced that the auction, which is part of President Joe Biden’s climate change agenda, generated less than $93 million in winning bids, marking it as one of the least lucrative auctions under the current administration, Reuters news report said.
Equinor secured a 101,443-acre lease 26 miles from Delaware Bay with a bid of $75 million.
Dominion’s Virginia Electric and Power acquired a 176,505-acre lease 35 miles from Chesapeake Bay for $17.65 million.
Dominion emphasized the importance of offshore wind in meeting the growing energy demands of the next decade, stating that the new lease provides a cost-effective option for delivering clean energy to customers.
Equinor, on the other hand, plans to take a cautious approach, with power production from its new lease not expected until after 2035.
Equinor
Equinor said the ~2 gigawatt (GW) lease will have the capacity to produce enough energy to power approximately 900,000 U.S. homes.
Equinor secured one of two fixed-bottom lease areas in the auction located 26 nautical miles from the mouth of the Delaware Bay.
“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 a rapidly growing demand for electricity with widespread support for adding renewable sources of energy into the power mix,” said Molly Morris, President of Equinor Renewables Americas.
Equinor’s win in the Central Atlantic builds off recent offshore wind milestones on the East Coast, with construction ongoing at the South Brooklyn Marine Terminal and offshore work underway to support the Empire Wind 1 project.
Dominion Energy
Virginia Electric and Power Company, a Dominion Energy subsidiary, said the lease area could support between 2.1 gigawatts and 4.0 gigawatts of offshore wind energy generation. The lease area is located approximately 35 nautical miles from the mouth of the Chesapeake Bay.
In early July, Dominion Energy announced the acquisition from Avangrid of the 40,000-acre Kitty Hawk Wind North offshore wind lease area, to be renamed CVOW South. CVOW South would have a capacity of 800 MW, enough capacity to serve 200,000 homes.
Robert M. Blue, chair, president and chief executive officer of Dominion Energy, said: “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.”
This auction follows a trend of declining industry interest, as evidenced by the recent cancellation of a planned offshore wind lease sale in the Gulf of Mexico due to insufficient demand. However, the Interior Department plans to hold additional offshore wind auctions later this year for areas off the coast of Oregon and in the Gulf of Maine, Reuters news report said.
Baburajan Kizhakedath