Feds to auction Maryland offshore wind sites

On August 19, the U.S. Department of the Interior's Bureau of Ocean Energy Management will auction off rights to lease sites off the Maryland coast for offshore wind.  Through the auction, which will represent the third auction for offshore wind sites in federal waters since July 2013, the Bureau hopes it will award leases to two areas covering approximately 80,000 acres about 10 nautical miles east of the Ocean City coastline.

Last year, the Department of the Interior held its first offshore wind site auction for sites off Massachusetts and Rhode Island; Deepwater Wind won that auction with a bid of $3.8 million.  The second auction, held for Virginia on September 4, covered approximately 112,799 acres about 23.5 nautical miles from the Virginia Beach coastline; Dominion Virginia Power won that auction with a bid of $1.6 million.

The Maryland auction later this month will follow procedures similar to those used in the previous two auctions.  Based on previous expressions of interest and qualifications, BOEM has determined that sixteen companies are eligible to bid on the Maryland sites:

• Apex Offshore Maryland, LLC
• Bluewater Wind Maryland LLC
• Convalt Energy LLC
• Dominion Wind Development, LLC
• EDF Renewable Development, Inc.
• Energy Management, Inc.
• Fishermen’s Energy, LLC
• Green Sail Energy LLC
• IBERDROLA RENEWABLES, Inc.
• Maryland Offshore Wind LLC
• Orisol Energy US, Inc.
• RES America Developments Inc.
• SCS Maryland Energy LLC
• Sea Breeze Energy LLC
• Seawind Renewable Energy Corporation LLC
• US Wind Inc.

How many of these entities actually participate in the auction remains to be seen.  8 qualified bidders (or their affiliates) also qualified to participate in the Virginia auction, but only winner Dominion and an Apex affiliate ever placed bids.  For Massachusetts and Rhode Island sites, 9 companies qualified to bid but only winner Deepwater, Sea Breeze, and US Wind participated.

Offshore wind project developers must coordinate regulatory, financial, and engineering efforts.  Securing a site for a project is a major step forward, but is only one of many important steps necessary to build an operating offshore wind project -- something the U.S. still lacks.  How much interest will the Maryland auction draw?  Who will win the right to lease the two parcels in the Maryland wind energy area, and how much will they pay?  Will the auction winners actually build offshore wind projects?  Some of these questions will be answered when the auction closes on August 19.