U.S. Wind Energy Blasts Forward With New $9 Million Offshore Lease

Some energy analysts are optimistic that renewables will continue to surge under the Donald Trump administration, with or without help from the Clean Power Plan. Part of that cheerful outlook is due to huge renewable energy buys already in the pipeline.

These projects will be difficult if not impossible to reverse. A case in point is the latest news from the U.S. Department of the Interior, which just announced a $9 million winning bid in auction for more than 122,000 acres of offshore wind energy development in the waters of North Carolina, at Kitty Hawk.

More American offshore wind energy

The U.S. has been a bit slow to join the global offshore wind market. But the long, relatively shallow Atlantic coastline is a tantalizing prize for renewable energy stakeholders.

According to one study, there is enough wind potential off the Atlantic coast to power every city on the eastern seaboard.

The industry made a significant step toward development in 2010, when the Barack Obama administration organized a lease program for Atlantic offshore wind energy under the Interior Department's Bureau of Ocean Energy Management (BOEM).

Several Republican governors of states on the eastern seaboard took steps to block offshore wind development, which slowed things down. But Rhode Island finally broke the logjam. Last fall, the tiny state flipped the switch on America's very first offshore wind farm.

Next up could be New York state, where Norway's Statoil recently won the rights to develop an 80,000-acre site for offshore wind.

BOEM held an auction for two wind areas off the New Jersey shore in 2015. But without a strong advocate in state leadership, those projects may stall out.

So far, New Jerseys's Board of Public Utilities has failed to take critical rule-making steps to prepare for the sale of the electricity generated by the proposed wind farm. Another offshore wind project in the state is also near collapse, which some locals attribute to policies under Gov. Chris Christie, despite support from the Obama administration.

In a rather tragic twist, the New York wind area is located within sight of the New Jersey shore. Once the New York wind farm is up and running, New Jersey residents will get a nice view of those turbines spinning on the horizon.

North Carolina wind on the rise

North Carolina has emerged as a clean power leader among southeastern states, partly because it is the only state in that region to establish renewable energy requirements.

Those rules took effect in 2007. They continued to propel renewable energy development in the state even after Republican Gov. Pat McCrory won the election in 2012, though offshore wind development spun its wheels. The prospects for offshore wind look better now that the state is under new leadership.

In the latest news, BOEM capped a five-year planning effort by announcing that the lease for North Carolina's Kitty Hawk wind area was provisionally granted to the company Avangrid Renewables.

The potential generating capacity of the wind area is an impressive 1,486 megawatts, according to estimates from the National Renewable Energy Laboratory, which can power around 500,000 homes. Avangrid will determine the actual size of the wind farm.

Zinke hearts renewables

In a press release announcing the results of the North Carolina auction, U.S. Interior Secretary Ryan Zinke appeared to make a clear break with Trump administration energy policy. He provided a ringing endorsement of renewables:

"The success of this lease sale reflects the continued interest of coastal communities to develop their offshore energy resources," Secretary Zinke said. "Renewable energy, like offshore wind, is one tool in the all of the above energy toolbox that will help power America with domestic energy, securing energy independence, and bolstering the economy."

And, here's the closing line:

"This is a big win for collaborative efforts with state, local, and private sector partners."

Though Zinke left the federal government out of his quote, the body of the press release makes it clear that the process was steered by his agency:

"BOEM has been working with the North Carolina Renewable Energy Task Force since 2010 to identify an area of sufficient size for offshore wind development, while avoiding ecologically sensitive areas and multiple use conflicts."

Avangrid Renewables also emphasized the role of the federal government in offshore wind development. Here's a snippet from the official statement from company CEO James P. Torgerson:

"We salute the U.S. Bureau of Ocean Energy Management and the Department of the Interior for the professional manner in which they went about the bidding process, reflected by the initial large number of parties that pre-qualified to bid."

Regardless of Zinke's praise and the support of a major global company (Avangrid is under the Ibderola Group umbrella), the Trump administration could throw up some roadblocks.

There is still some paperwork to be done before the lease is official, including an analysis by the Department of Justice and the Federal Trade Commission.

If all goes according to the timetable, Avangrid has a window of 4.5 years to submit a construction plan for approval by BOEM.

Image (cropped): via the Bureau of Ocean Energy Management.