Avangrid Wins North Carolina Offshore Wind Auction

Avangrid Renewables, LLC, a subsidiary of Iberdrola, has secured a lease sale of 122,405 acres offshore Kitty Hawk, North Carolina, for offshore wind development after 17 auction rounds with a winning bid of USD 9,066,650.

Avangrid has beaten three other bidders, Wind Future LLC, Statoil Wind US LLC, and wpd offshore Alpha LLC, to secure what is the first offshore wind lease area off North Carolina.

The Kitty Hawk lease area begins about 24 nautical miles from shore and extends 25.7 nautical miles in a general southeast direction. Its seaward extent ranges from 13.5 nautical miles in the north to .6 of a nautical mile in the south.

Using the National Renewable Energy Laboratory’s estimates of 3 megawatts (MW) per square kilometer, the lease area has a potential generating capacity of 1,486MW. The actual size of the wind energy project will be determined by the developer.

Before the lease is executed, the US Department of Justice and Federal Trade Commission will conduct a review of the auction, and the provisional winner will be required to pay the winning bid and provide financial assurance to the US Bureau of Ocean Energy Management (BOEM). The lease will have a preliminary term of one year, during which the lessee may submit a Site Assessment Plan (SAP) to BOEM for approval. The SAP will describe the facilities (e.g., meteorological towers or buoys) the lessee plans to install or deploy for the assessment of the wind resources and ocean conditions of its commercial lease area.

Following approval of a SAP, the lessee will then have four and a half years to submit a Construction and Operations Plan (COP) to BOEM for approval. This plan will provide a detailed proposal for the construction and operation of a wind energy project within the lease area.

Once BOEM receives a COP, it will conduct an environmental review of the proposed project and reasonable alternatives. Public input will be an important part of BOEM’s review process. If BOEM approves the COP, the lessee will then have a term of 25 years to construct and operate the project.

To date, BOEM has held seven competitive auctions, generating over USD 67 million in revenue to the federal government, in exchange for leases covering over 1.1 million acres, including the record USD 42.5 million bid for the New York offshore wind lease area submitted by Statoil.

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