The Biden administration Friday postponed its first-ever offshore wind sale off the coast of Oregon, saying there wasn’t enough industry interest to move forward right now.
This marks the second time this year that an offshore wind auction was canceled over lackluster industry participation, blunting the Biden administration’s efforts to rapidly scale up offshore wind development in new areas of the ocean.
The canceled sale also comes on the heels of a critical letter from Oregon Gov. Tina Kotek to the Bureau of Ocean Energy Management. In the letter sent Friday morning, the Democratic governor asked for the sale to be canceled and accused BOEM of creating discord in the state by moving too fast on offshore wind.
“I request that BOEM halt all current leasing activities off the coast of Oregon and terminate the current auction,” Kotek said.
The Kotek administration and BOEM did not respond to a request for comment.
The Biden administration has significantly boosted the nation’s young offshore wind sector to help reach its larger goal to decarbonize the U.S. electricity grid by 2035. That effort has included holding lease auctions in regions across the country, intended to give the industry a foothold to start developing offshore wind projects in new markets. But that effort has had mixed results in areas where demand for offshore wind is low.
In July, BOEM canceled one of those sales — in the Gulf of Mexico — because too few developers were interested in participating. An August auction off the coast of Virginia, meanwhile, attracted six bidders, but netted a modest $93 million, less than blockbuster sales in New England and off the coast of New York, where demand for offshore wind is high.
BOEM said Friday that five companies had prequalified for the Oct. 15 sale, which had included two proposed lease areas off the coast of southern Oregon. Together, the parcels could support enough offshore wind to power 1 million homes. But only one company said it might participate after the final sale notice was published in August, according to BOEM.
Wind is strong off the coast of southern Oregon, where the state aims to deploy 3 gigawatts of offshore wind by 2030. But the region is not yet prepared for offshore wind in terms of port infrastructure and a supply chain to build and deploy wind farms.
Kotek’s administration is working on a state road map for wind off its coast and has asked the Biden administration several times to delay leasing until after that plan is finished. Oregon lawmakers like Sen. Jeff Merkley (D) have also urged BOEM to slow down. The state’s work is in part to address concerns that offshore wind will restrict the state’s fisheries and affect cultural values for Native American tribes.
Water off the coast of Oregon is also too deep for traditional wind foundations and will require floating platforms. This emerging technology has not been widely deployed commercially and so its potential impacts on the environment are not well-understood.
In a letter earlier this year, BOEM Director Elizabeth Klein assured Kotek that it would take years for offshore wind farms to be developed off the Oregon coast, leaving ample time for state planning.
The Oregon governor’s letter Friday accused BOEM of creating conflict in the state over offshore wind. She also threatened to leave BOEM’s intergovernmental task force.
“I am disappointed that BOEM’s accelerated process over the last year has further divided stakeholder communities,” the governor wrote. “Oregon’s legislative Coastal Caucus is likewise now in full opposition to BOEM’s proposed lease.”
The Confederated Tribes of the Coos, Lower Umpqua and Siuslaw Indians sued the Biden administration earlier this month to try and halt the sale.
Kotek said her office has heard feedback from renewable energy, labor, fishing and conservation communities, arguing that a failed lease process could damage coastal habitats and thwart Oregon’s development of a renewable energy supply chain.
Sam Salustro, vice president of strategic communication at Oceantic Network, a supply chain trade group for offshore wind, expressed support for BOEM’s decision Friday.
“The West Coast is an emerging market that will require new technologies,” he said in a statement. “Oceantic is confident that Oregon will soon join other states in the development of offshore wind projects as conversations continue and supply chain opportunities materialize.”
He noted that Oregon’s neighboring states are advancing offshore wind and that a regional supply chain will be key for the industry to grow.
California aims to reach 25 GW of offshore wind by 2045 and has recently allocated funding for key transmission infrastructure to bring offshore wind in Northern California, near the Oregon border, to areas with high electricity demand like the San Francisco Bay.
Washington Gov. Jay Inslee (D) also recently formed the Blue Wind Supply Chain Collaborative to encourage local manufacturing for offshore wind parts.
