While NRG Energy (NYSE:NRG) put active development of offshore wind projects on hold in late 2011, the U.S. Department of the Interior (DOI) has granted company subsidiary NRG Bluewater Wind Delaware exclusive right to submit offshore wind energy plans.
Interior Secretary Ken Salazar and Bureau of Ocean Energy Management (BOEM) Director Tommy Beaudreau said on Oct. 23 that the BOEM has reached agreement on a lease for commercial wind energy development in federal waters that covers 96,430 acres about 11 nautical miles off Delaware’s coast.
The lease grants NRG Bluewater Wind Delaware the exclusive right to submit one or more plans to BOEM to conduct activities in support of wind energy development in the lease area. DOI also said that the company may submit a site assessment plan with a proposal to conduct site assessment activities, including the installation of a meteorological tower or meteorological buoy, and/or submit a construction and operations plan to propose construction of the actual wind facility and cabling to shore.
NRG Bluewater had proposed a 450-MW project offshore Delaware, but put those plans on hold.
“[A]s we said last December when NRG made the decision to ramp down active offshore development, we will continue to preserve important assets of our offshore wind development program until the market should recover,” David Gaier, communications manager with NRG, told TransmissionHub on Oct. 24. “Signing this commercial lease is one of those important steps in preserving our valuable offshore wind development assets.”
In December 2011, NRG said it is putting active development of offshore wind projects on hold for the near term, noting that NRG Bluewater Wind, its subsidiary and lead developer of the Mid-Atlantic Wind Park (MAWP) off the coast of Delaware, has been unable to find an investment partner and intends to end the project’s 200-MW power purchase agreement with Pepco Holdings (NYSE:POM) subsidiary Delmarva Power and Light.
In July, NRG President and CEO David Crane told TransmissionHub, “[W]e’re not saying it’ll never be resurrected, but right now, there are just so many different aspects of offshore wind in the United States that require coordinated government action, and we just don’t see that that’s going to happen.”
Gaier said the company will continue to work with the state of Delaware, and is continuing to seek partners for the MAWP with a number of strategic and financial investors, which was always a central part of NRG’s plan when it acquired Bluewater Wind. “This commercial lease makes the asset more valuable and appealing to partners and investors,” he said.
He also said that NRG has been working on the lease with BOEM for several months. “The lease doesn’t grant the right to build the project itself,” he added. “That requires going through the permitting process with BOEM, which will include many steps starting with an environmental impact statement. The lease doesn’t specify the size of any specific potential project or turbine layout.”
According to DOI, the lease area, which is made up of 11 full Outer Continental Shelf (OCS) blocks and 16 partial blocks, has been located to avoid existing uses of the OCS offshore Delaware, including major shipping lanes into and out of Delaware Bay, a proposed vessel anchorage ground and a munitions disposal area.
Salazar said in the statement, “Delaware has remarkable offshore wind potential, and harnessing this clean, domestic energy resource will create jobs, increase our energy security and strengthen our nation’s economic competitiveness.”
The lease is the first one completed under DOI’s “Smart from the Start” approach to facilitate offshore wind development along the Atlantic OCS by identifying wind energy areas in a coordinated approach with environmental analysis, public review and large-scale planning, DOI said.
American Wind Energy Association CEO Denise Bode said in an Oct. 24 statement that developing the country’s “offshore wind resource will help us capture a new American manufacturing opportunity and create thousands of new American jobs.”