Equinor and Dominion win $92.65 million offshore wind lease sale in Central Atlantic

Written by

Nick Blenkey

Two established U.S. offshore wind players, Equinor and Dominion Energy, won today’s sale of offshore wind leases in the Central Atlantic.

The sale, announced in June, was the fifth under the Biden administration. It attracted $92.65 million in winning bids for two lease areas outside Delaware, Maryland and Virginia. The sale — the first in the region in a decade — yielded two provisional winners and $92.65 million in winning bids.

Equinor Wind US LLC provisionally won the lease for OCS-A 0557 for $75,001,001, covering 101,443 acres and located approximately 26 nautical miles (nm) from Delaware Bay.

Dominion Energy subsidiary Virginia Electric and Power Co. provisionally won the lease for OCS-A 0558 for $17,650,500, which covers 176,505 acres and is located about 35 nautical miles from the entrance to Chesapeake Bay. Six companies participated in the auction.

“Today’s lease sale represents an important milestone in meeting demand for clean, renewable energy along the Eastern Seaboard,” said Bureau of Ocean Energy Management (BOEM) Director Elizabeth Klein. “BOEM remains committed to the responsible development of offshore wind in the Central Atlantic region in a manner that avoids, reduces, or mitigates potential impacts to other ocean users and the marine environment while growing local economies.”

Equinor said the area it leases, located 26 nautical miles from the mouth of Delaware Bay, has the potential to generate 2 gigawatts (GW), enough energy to power about 900,000 U.S. homes.

“Equinor’s interest in this auction is consistent with our approach to pursuing attractive offshore wind opportunities in the United States,” said Molly Morris, president of Equinor Renewables Americas. “The Central Atlantic region has rapidly growing electricity demand, and there is broad support for adding renewables to the energy mix.”

“Today’s announcement underlines Equinor’s commitment to delivering value through renewable projects,” said Pål Eitrheim, Executive Vice President of Equinor Renewables. “This is a long-term option with first power after 2035. The development of this lease area will build on Equinor’s proven offshore wind capabilities. We will take a disciplined approach to minimize risk and develop a solid project in our portfolio.”

Dominion Energy said winning the lease gives it the ability to continue to expand offshore wind energy in the mid-Atlantic. It cited BOEM as indicating the lease area could support 2.1 gigawatts to 4.0 gigawatts of offshore wind energy. The lease area is about 35 nautical miles from the mouth of the Chesapeake Bay.

In early July, Dominion announced the acquisition of a 40,000-acre lease from Avangrid for the Kitty Hawk Wind North offshore wind farm, to be renamed CVOW South. If approved by regulators and built, CVOW South would have an 800-megawatt capacity, enough to serve 200,000 homes.

The company does not currently have an estimated timeline or cost for CVOW South or the new lease.

“Offshore wind is central to our comprehensive approach to meeting the unprecedented growth in electricity demand from our customers over the next decade,” said Robert M. Blue, chairman, president and CEO of Dominion Energy. “Winning this lease gives us another low-cost option to meet growing demand while providing our customers with reliable, affordable and increasingly clean energy.”

Dominion says its CVOW continues to operate on schedule and on budget, with service completion expected by the end of 2026. To date, 54 monopiles have been installed since the start of the installation campaign on May 22, 2024, which is in line with the company’s goal of installing 70-100 monopiles in the first of two installation seasons spanning May through late October.

NOIA STATEMENT

National Ocean Industries Association President Erik Milito issued the following statement following the completion of the Central Atlantic wind lease sale:

“Offshore wind continues to show a very positive long-term trend. The industry is growing, with companies investing in communities, jobs and the supply chain. Lease acreage in Maryland and Delaware has seen significant increases in bid amounts, multiplying several times over a decade ago. Similarly, offshore lease acreage in Virginia has commanded significantly higher bids than similar leases just a few years ago.

“The sale of Central Atlantic wind leases could sustain the momentum of the U.S. offshore wind industry, which has matured significantly, creating jobs and investment in many states well beyond those adjacent to new wind farms. Continued wind lease sales will further expand the supply chain, making the industry more competitive and routine. In the past 12 months, the first U.S. utility-scale offshore wind farm has begun producing power, the first U.S. offshore wind substation has been commissioned, and the first American-built, American-owned, and crewed offshore wind support vessel has been christened. Additionally, three support crew transfer vessels have been delivered.

“But Washington must do more to maintain this momentum. This will be the first year without a federal offshore oil and gas lease sale since 1958. After December of this year, the Department of the Interior will not be able to conduct any further offshore lease sales until another offshore oil and gas sale is conducted. The current leasing reality requires a congressional fix to provide much-needed regulatory certainty and normalcy for both offshore oil and gas and wind lease sales.”

“Securing new leases is critical to the exploration and development of our nation’s critical resources. Periods of inactivity in lease sales only increase uncertainty and risk, driving investment dollars overseas. Maintaining regular lease sales ensures energy continuity, promotes economic growth and the development of new supply chains, and keeps the United States competitive in the global energy market.”

Sale details HERE