Two companies have won the rights to develop floating offshore wind turbines in the Gulf of Maine.
Results from the federal government's first-ever wind energy lease sale netted about $22 million in lease payments for four parcels off the coast of Cape Cod and Maine.
Avangrid Renewables, based in Connecticut, submitted winning bids of $4.9 million and $6.2 million for two parcels about 30 miles off the coast of Cape Cod, according to the Bureau of Ocean Energy Management.
Invenergy NE Offshore Wind, meanwhile, won an area more than 46 miles off the Maine coast for $4.9 million and another off Cape Cod for $5.8 million.
In total, the companies leased about 440,000 acres of ocean. Only half of the parcels officials put up for sale were bid on during Tuesday's auction.
A bureau representative would not divulge how much the federal government hoped to earn from the sale. The agency does not publish expected energy revenue, but "the sale price of $50 per acre was established as a baseline to provide fair return to the taxpayer," spokesperson Alison Ferris said in an email. That baseline payment roughly equals the amount Avangrid and Invenergy bid for the leases.
The sale results were far less than eye-popping sums spent on offshore wind leases about two years ago. Developers bid $4.37 billion on six lease areas off New York in early 2022 and another $757 million on a five-parcel sale in California later that year.
Kate Sinding Daly, senior vice president for law and policy at the Conservation Law Foundation, acknowledged high inflation and other economic challenges have slowed the offshore wind energy industry. But the sale outcome shows developers are still attracted to the massive energy potential in the Gulf of Maine, she added.
"We don't see there is significant waning interest in wind development in our region," Daly said.
Maine supporters of floating offshore wind also saw the sale as a success.
"Responsibly developed offshore wind will make us more energy independent, reduce harmful air pollution, and deliver good-paying jobs, all while protecting ocean wildlife and avoiding key fishing grounds," said the Natural Resources Council of Maine climate and clean energy director Jack Shapiro.
The sale was also successful compared to recent failed wind power auctions off the Oregon coast and in the Gulf of Mexico, Shapiro added.
Gov. Janet Mills' administration wants Maine to be a central player in the nascent floating offshore wind industry. The Gulf of Maine is too deep to support bottom-mounted wind turbines, so arrays have to be floated out and attached to the sea floor with cables.
Maine was granted a special lease this year to try out technology the University of Maine has developed alongside industry partners Diamond Offshore Wind.
The Maine Department of Transportation has proposed building a specialized port on vacant state-owned land on Sears Island. But the proposal has run into opposition from conservation advocates. The federal government recently rejected Maine's application for a $456 million grant to build the facility.
Dan Burgess, director of the Governor's Energy Office, said the federal lease sale represented a "significant milestone" for Maine and the region as it develops offshore wind to reduce a dependence on expensive fossil fuels and fight climate change.
"We look forward to following the next phases of these lease sales and building on our progress to foster this industry for the benefit of Maine people," Burgess said.
Maine's plans to develop offshore wind have been opposed by some fishing interests, including the powerful lobster industry. But that defiance has softened after the governor barred wind developments in state waters and important offshore lobster fishing groups were excluded from the federal lease sale.
