BOEM Holding New York Offshore Wind Auction

[The auction has ended after the 33rd round.]

Rounds (reverse chronological order):

16 December:

32nd round (closed at 16:00 CET): asking price – USD 39,469,725; 2 bidders.

31st round (closed at 15:40 CET): asking price – USD 36,469,725; 2 bidders.

30th round (closed at 15:20 CET): asking price – USD 33,469,725; 2 bidders.

29th round (closed at 15:00 CET): asking price – USD 30,469,725; 3 bidders.

28th round (closed at 14:40 CET): asking price – USD 27,469,725; 3 bidders.

The US Bureau of Ocean Energy Management (BOEM) is resuming a commercial wind lease sale for 79,350 acres offshore New York today (16 December), after 27 rounds were held yesterday with three companies still bidding. Today’s second (29th overall) round left only 2 bidders still participating. 

The auction started with six out of 14 qualified companies placing bids. After the 24th round, three bidders were still taking part in the auction, which has been paused as the 27th round ended and resumed today.

Bidders cannot sit out early rounds and must bid in every round to be eligible to bid later, meaning that the same six companies were “in the game” from the beginning, the same three have continued bidding after the 24th round, and two companies were willing to pay almost USD 40 million (32nd round) for the lease offshore New York. Given that the process is being held as a blind online auction with BOEM-set asking prices, the companies competing to build an offshore wind farm of up to 800MW are unknown at this point.

Big players competing for an offshore wind farm in New York

BOEM had identified 14 companies as legally, technically and financially qualified to participate in the auction: DONG Energy, innogy, Iberdrola’s Avangrid Renewables, EDF Renewable Development, Statoil Wind US, wpd offshore Alpha, Deepwater Wind Hudson Canyon, New York State Energy Research and Development Authority (NYSERDA), Fishermen’s Energy, Sea Breeze Energy, CI-II NY Inc, Energy Management, Inc, Convalt Energy, and Clean Power Northeast Development.

Last week, fishing groups concerned about the impact of a large-scale wind project on fishing areas filed a complaint to the federal court, aiming to delay the auction. However, the legal action had no effect on the scheduled lease sale, since the “court has not yet ruled on plaintiffs’ motion to delay auction”, according to BOEM.

The area starts approximately 11.5 nautical miles (nm) from Jones Beach, NY. From its western edge, the area extends approximately 24 nm southeast at its longest portion. The lease area consists of five full Outer Continental Shelf blocks and 143 sub-blocks.

This offshore wind auction differs in two things from the auctions BOEM has held previously.

In terms of the auction format, this auction is the first to feature a Limited Opportunity to Revoke, under which a provisionally winning bidder will have a chance to revoke its winning bid without forfeiting its bid deposit.

Also, this is the first multiple-factor auction to offer a non-monetary credit to bidders that can establish that they are a government authority. In line with this, NYSERDA has requested this 10 percent credit when it submitted the required documentation for the lease sale.

Photo: Illustration; Image: DONG Energy

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