The U.S. Bureau of Ocean Energy Management (BOEM) said Oct. 27 it designated four wind energy areas in the Gulf of Mexico (GoM) as it aims to deploy 30 gigawatts (GW) of offshore wind energy capacity by 2030.

Combined, the areas—three offshore Texas and one offshore Louisiana—could provide enough electricity to power more than 3 million homes, BOEM said.

“Creating an offshore wind industry in the Gulf of Mexico will take time and partnership,” BOEM Director Elizabeth Klein said in the news release. “BOEM is pursuing another offshore wind lease sale in the Gulf of Mexico due to continued industry interest and feedback from our partners and key stakeholders.”

The four new wind energy areas are: Option J, 495,567 acres about 47 miles offshore Texas; Option K, 119,635 acres about 62 miles offshore Texas; Option L: 91,157 acres about 53 miles offshore Texas; and Option N: 56,978 acres about 82 miles offshore Louisiana.

Gulf of Mexico wind energy areas Source BOEM.jpg
Gulf of Mexico wind energy areas. (Source BOEM)

Word of the wind energy areas comes after the first U.S. GoM offshore wind lease sale in August brought in only one high bid. RWE Offshore U.S. Gulf LLC was the lone provisional winner, securing acreage offshore Louisiana with its high bid of $5.6 million. There were no takers for the two areas offshore Texas. It also comes amid oil and gas uncertainty in the GoM as the industry awaits word on its next lease sale and braces for what could be a drastic slowdown in offshore oil and gas lease availability.

Challenging times

Offshore wind developers have faced challenges with rising costs and supply chain woes. Equinor, which is developing Empire Wind and Beacon Wind offshore New York and floating wind offshore California, booked a $300 million impairment in its renewables segment during third-quarter this year.

Despite the obstacles, several offshore developments continue to move forward. These include Dominion Energy’s Coastal Virginia Offshore Wind, which recently unloaded the first eight monopile foundations for the 2.6-GW project, and Vineyard Wind 1, which this month installed the first of its project’s 62 turbines offshore Massachusetts.

“Moving offshore wind lease opportunities forward across all of our coasts will drive investment and interest in this energy opportunity,” National Ocean Industries Association (NOIA) President Erik Milito said in a statement.

NOIA’s members include companies involved in offshore wind development and offshore oil and gas, which have also faced uncertainty in recent months as the BOEM slashed the number of oil and gas lease sales in its proposed 2024-2029 National Outer Continental Shelf Oil and Gas Leasing Program and a court battle involving an endangered whale species left the next GoM lease sale in limbo.

“The success of offshore wind and offshore oil and gas goes hand in hand,” Milito said.

Inextricably linked

The IRA links oil and gas lease sales to renewable energy leasing. The law states that BOEM may only issue a lease for offshore wind development if in the previous year it offered at least 60 million acres for oil and gas leasing.

Speaking Oct. 26 during the Senate Energy & Natural Resources Committee hearing, Sen. Joe Manchin said the “new five-year leasing program falls well short of what we should be doing by including only three oil and gas sales.”

Manchin, an all-of-the-above energy backer, said he was concerned about the signals BOEM and National Oceanic and Atmospheric Administration are sending offshore wind.

“By only allowing only three offshore oil and gas leases over the next five years, the administration is creating immense uncertainty for the wind industry. … They are cutting off their noses to spite the face,” Manchin said.

Manchin pointed out that there would be several periods when no wind leases can be issued with only three proposed oil and gas lease sales.

Sen. Manchin’s chart.jpg
(Source: NOIA, Manchin presentation)

“If any of these three oil and gas sales are delayed or shrunk by a lawsuit below the 60 million-acre threshold in the IRA, this could lead to a moratorium on wind leasing for as much as two or three years,” Manchin said.