Biden Announces First Offshore Wind Lease Sales in Gulf of Mexico

July 21, 2023 5:22 PM

The official press release : "The Department of the Interior announced [yesterday] it will hold the first-ever offshore wind energy lease sale in the Gulf of Mexico, advancing the Biden-Harris administration’s work to deploy 30 gigawatts (GW) of offshore wind energy by 2030 and reach a carbon-free electricity sector by 2035."

Reuters: "The sale will include a lease area of 102,480 acres offshore Lake Charles, Louisiana, and two lease areas totaling nearly 200,000 acres offshore Galveston, Texas, the White House said. Companies will bid on the right to develop those acres. The areas have the potential to generate about 3.7 Gigawatts and power, supplying nearly 1.3 million homes with clean energy, the Interior Department said."

Law360 (paywalled): "Biden's speech [in Philadelphia, announcing the Gulf of Mexico lease sale] comes just over two weeks after his administration granted approval for Danish energy company Orsted's 1,100-megawatt wind project off the New Jersey coast, a project expected to create 3,000 jobs and power over 380,000 homes.

All of the components and labor for the Gulf wind project will come from the United States, Biden said. ...

'And despite what the other guy said, windmills do not cause cancer,' Biden said in an apparent jab at his predecessor, former President Donald Trump.

The Philadelphia Shipyard is tasked with building the Acadia, a ship intended to support the Biden administration's sweeping offshore wind projects, which the government has said will create thousands of union jobs by 2030.

'Union workers are the best in the world,' Biden said, urging corporate leaders to see that unionized labor is good for business. 'They do the job right, they do it on time, and long term it costs less than non-union labor,' Biden said. ...

Orsted's coastal New Jersey project, Ocean Wind 1, will be composed of 98 wind turbines located 13 nautical miles off the coast of Atlantic City.

Ocean Wind 1 is the third commercial-scale, offshore wind energy project to be approved by the Biden administration, joining the Vineyard Wind project off Massachusetts and the South Fork Wind project off of Rhode Island and New York."

posted by Artifice_Eternity (23 comments total)

Good. More to come, hopefully.
posted by flabdablet at 5:58 PM on July 21, 2023 [7 favorites]

It's a good start. We build the Wind power up north, but can t build it in our own coast.

Notice that they are not engaging with the Wind Power potential near the ports of Venice or Fourchon.

Those Ports are guarded by the oil industry. The industry knows full well that they are not only competing on price, they are competing for the labor of Gulf mariners.

"Oil Services" could flip to Wind Power practically overnight, and Exxon, Chevron, Shell know this.

Shell will submit bids. Exxon is focused on leasing the Gulf for CCS.

Compare this lease sale with how BOEM leases oil and gas leases, and you will find good ocean planning practices.

Wind Power is avoiding Shrimping grounds. Wind Power is avoiding Rice s Whale habitat.

There s a "fisheries fund" to support any impacts to the fishing economy from siting new structures in the Gulf. The oil industry doesn't have to do this, but they should.

We need this to succeed. There are debates on whether the Turbines need to be re-engineered for Gulf winds, and how and where to site Transmission lines.

Also, most or all of the Power will go to power refineries. This is expected and necessary to mitigate the major CO2 emitters of the United States in Texas and Louisiana, the petro manufacturing plants along I-10.
posted by eustatic at 5:59 PM on July 21, 2023 [12 favorites]

God damn we could use more union density in the Gulf. There are also some labor rules in the lease sale.

A requirement to pay prevailing wages is good, but it s unclear whether prevailing wage requirement will apply to prison labor (welders, roughnecks) that the oil industry employs for oil services, as prisoners are not considered "employees" under US law.

It s unclear how prevailing wage requirements will apply to Filipino migrant labor

It s unclear what the labor rules will do, there s a need to build capacity at HBCUs to train Black folks to work offshore under Union accreditation programs, since traditionally the oil industry avoids hiring Black folks, and hiring Black folks in skilled positions.

There s an opportunity for Clean Energy to improve equity in hire Offshore.

Right now the Wind guys make noises about not paying as much as Oil. This is a mistake. Oil workers want to work for Wind companies, but they have mortgages. If Wind capitalists had any brains they would hire union and union rates, there would be an oil labor shortage overnight
posted by eustatic at 6:11 PM on July 21, 2023 [13 favorites]

Good! The planned off-shore leases off the coast of Oregon just got paused, I believe, though the California ones are still on-track. The timeline from announcing leases to having built-out wind farms is really long, so just getting things started is a major hurdle overcome.
posted by Dip Flash at 6:20 PM on July 21, 2023 [2 favorites]

The Boat capitalists in Houma are already making money, building "Flotels" for offshore construction crews.

It is a very fascinating moment. Their revenue is beginning to conflict with their political donations and financial positions in Oil.

No matter what you hear, Offshore has been dead since 2008. Fracking has taken all the economic incentives away from the drive to "Drill Baby Drill" and oil lease sales will not grow again, despite the recent spike in CCS Oil drilling leases.

There s much more work than is happening Offfshore in Plugging Inactive oil wells and removing dead pipelines from the Gulf.

Look up the "True Transition" labor survey, and support Offshore workers if you want a climate future for the USA.
posted by eustatic at 6:20 PM on July 21, 2023 [7 favorites]

Right now the Wind guys make noises about not paying as much as Oil. This is a mistake. Oil workers want to work for Wind companies, but they have mortgages. If Wind capitalists had any brains they would hire union and union rates, there would be an oil labor shortage overnight

At a holistic level, maybe. But this is a decision made at the individual company level, and even more so project-by-project. They'll do what is required (like if there are union requirements by the state), but otherwise it is about the economics of an individual project site and what commitments got made to stakeholders and agencies. In parts of the west, unions have been strong supporters of renewables projects, so there has been an element of mutual back scratching in terms of strong public support during permitting in exchange for commitments to hire union.
posted by Dip Flash at 6:26 PM on July 21, 2023 [2 favorites]

Also, we really need to support recognition for the United Houma Nation, and the Comecrudo tribe in Texas.

The USA is doing fuck all for Tribes on the Gulf, because they are not Federally recognized.

But if we can build Wind Power to displace the hunger for middle class jobs, we can finally have room to close the R360 Bourg waste pits near Grand Bois, which is a human rights atrocity for the Houma Nation folks living in Grand Bois.

In fact, if there are bird people in the thread, please realize that the oil industry kills more birds than Wind ever will, particularly via the waste pits in Jennings, Morgan City, and Bourg. Look at them in Google Maps! There are ugly and deadly.

Closing these open E&P waste pits will do more for Birds than fighting Wind power. Closing R360 Bourg pits can give native communities a chance at getting clean water and clean air again.
posted by eustatic at 6:35 PM on July 21, 2023 [11 favorites]

It seems like it would be a genuine shame if any of that American taxpayer-funded energy (or subsidized energy, via the lease business model) went into the Texas power grid, where energy companies gouge regular folks with unregulated ("deregulated") pricing. That doesn't seem like a good thing for Americans, even as renewables are truly important to push over fossil fuel leases.
posted by They sucked his brains out! at 6:50 PM on July 21, 2023

In fact, if there are bird people in the thread, please realize that the oil industry kills more birds than Wind ever will, particularly via the waste pits in Jennings, Morgan City, and Bourg. Look at them in Google Maps! There are ugly and deadly.

Also, Painting Wind Turbine Blades Black Help Birds Avoid Deadly Collisions

A recent study found the simple intervention reduced bird mortality by 72 percent
posted by chariot pulled by cassowaries at 6:54 PM on July 21, 2023 [9 favorites]

eustatic, Dip Flash, chariot pulled by cassowaries: Thanks for all the additional info!

I'm frustrated that the enormous movement in U.S. offshore wind powre doesn't get more media coverage. I follow the policy (and litigation) around this in the course of my job, but there's a lot I still don't know about the business (and labor) side.
posted by Artifice_Eternity at 7:05 PM on July 21, 2023

In Rhode Island I am delighted to see those things going up! More, more!!

My employer is leasing out a stretch of waterfront property we own for staging the huge components, and I want to go drive down there and hand out muffins and high fives to all the workers.
posted by wenestvedt at 7:20 PM on July 21, 2023 [9 favorites]

Greetings from New Jersey! I am personally excited about Ocean Wind 1, despite all the hiccups it has encountered along the way. President Biden's recent approval of this wind farm was big news here, and will hopefully quell some of the opposition.

I say "hopefully", but the opposition mostly consists of, yup, NIMBYs. South Jersey along the Shore is one of the more Republican parts of the state, but the NIMBYs' politics don't really matter (living in the SF Bay Area has taught me such) so much as the fact that their ocean views are being ~ruined~, poor dears. Never mind the clean energy benefits, nor the local jobs created. However, there is another wrinkle.

There has been a higher than usual number of dead whales washing up along the Jersey Shore since late last year, giving the NIMBYs, and the oil companies, new ammo. This shouldn't come as a surprise, but it's not the wind turbines that's killing them, but most likely big cargo ships-- New Jersey is home to the largest container port on the East Coast-- and fishing nets.

Gov. Murphy, probably the best Governor NJ has had during my time living here, is all-in on clean energy, and I hope these efforts will make a difference.
posted by May Kasahara at 7:44 AM on July 22, 2023 [8 favorites]

How does this square with the increase in powerful storms coming along in the next 100 years until infinity? I'm genuinely curious if this is an issue?
posted by tiny frying pan at 8:16 AM on July 22, 2023

I came across this chart last week concerning bird mortality.

It was always the cats.
posted by art.bikes at 9:03 AM on July 22, 2023 [3 favorites]

Missing from that chart is mortality from smoke stack emissions. Considering pet birds are killed by pretty low levels of air pollution because of their high efficiency respiratory systems (eg cooking with a Teflon pan) emissions must kill a lot of wild birds.
posted by Mitheral at 9:11 AM on July 22, 2023 [3 favorites]

Will oil companies be able to bid but not build, cause that would really suck. Years ago, auto companies bought inter-town trolley companies just to shut them down.
posted by theora55 at 9:24 AM on July 22, 2023 [1 favorite]

Will oil companies be able to bid but not build, cause that would really suck. Years ago, auto companies bought inter-town trolley companies just to shut them down.

No, BOEM will run this like all the other off-shore wind lease auctions, and companies have to be pre-qualified by BOEM in order to bid. This article about the recent lease auction in California talks about the process somewhat, and links to things like the BOEM notice in the Federal Register that includes the list of pre-qualified companies for the California auction.

This press release from the Dept. of the Interior talks about how that process will work for the gulf auction, including pre-qualification. Being a subsidiary of or linked to an oil company wouldn't disqualify a bidder at all, but the pre-qual criteria is going to stop anyone from just sort of casually trying to lock in leases as a spoiler. Plus, the leases are expensive. The scale of money involved in off-shore wind development is orders of magnitude higher than a local trolley company, and the process is structured to disincentivize that.
posted by Dip Flash at 10:14 AM on July 22, 2023 [3 favorites]

Actually, they have already selected the eligible bidders for the gulf leases; you can see them here. A Shell renewables subsidiary is one of them; the rest look like a mix of recognizable huge players in off-shore wind like Equinor and Avangrid, and some more anonymously-named LLCs that are probably consortiums of small, medium, and large players in the industry, or are single-project spin-offs of one of the big companies.
posted by Dip Flash at 10:24 AM on July 22, 2023 [4 favorites]

Good to see this. More, please - and more quickly.
posted by doctornemo at 11:24 AM on July 22, 2023 [2 favorites]

Will oil companies be able to bid but not build, cause that would really suck. Years ago, auto companies bought inter-town trolley companies just to shut them down.
posted by theora55 at 9:24 AM on July 22

Don't worry, dirty competition like this can happen a few different ways, although not in the way you describe. Under BOEM and the US IRA bill, Oil is given several kinds of advantages over Wind.

A lot of these conflicts are hidden right now, because everyone agrees it's more important to build viable Wind businesses offshore. Wind isn't out of the womb yet. but the conflicts / safeguards will emerge if Wind succeeds and tries to scale up. Oil is mostly finance nowadays, and Wind has to be kept down to avoid the stranded assets problem.

I wish i could spoiler all of this, because honestly it's not as urgent as some other issues right now, and it's long.

1a) Squatting good wind areas by leasing for waste injection

The first is called "CCS", which used to be called "Clean Coal." CCS starts with "scrubbing" the CO2 from your LNG, methanol, ammonia, plastics or Oil refinery. LNG and SMR Ammonia plants have the "AGRU" Acid Gas Reduction built into their refineries already, so this part is much less expensive for them.

Then fossil fuels are burned to compress the CO2 and it is piped past Galveston Island and injected offshore in shallow wells. Unlike oil drilling, you don't have to be as selective in your location, because much of the Gulf and the Mid-Continent have a shallow saline confinement layer suitable for injection. (or, the layer existed naturally before we started drilling through it, in many places, "confinement" is speculative)

US DOE has been trying to make this work onshore for 15 years, and they have not succeeded. The "scrubbing" has a lot of problems, and generates a lot of solid waste if your facility is not an LNG or SMR facility, and the sequestration is even harder. So we really don't know if containment of the CO2 is permanent, because the engineers haven't been able to inject effectively very much CO2 and make it stick in 15 years of trying.

We know how to push CO2 into holes to get more oil, but companies have never had an opportunity to make sure that it stays there, because we haven't been able to do the scrubbing or injection well, and we haven't been looking for very long. The companies doing CO2 EOR have gone bankrupt. The Clean Coal projects have failed. The best CCS project operated at 50% of its target, and almost all of them have operated at 0%. We have however, put 45 people in the hospital in rural Mississippi, and given many of permanent drain damage, in a CO2 pipeline disaster in Satartia. The skin color breakdown of these 45 souls is left as an exercise to the reader. Your US Dept of Energy tax dollars.

Every well is a demonic, unstable portal to the underworld, rife with unseen and unstable pressure fronts. they do not behave and they can unleash hell on earth. making more demon portals is risky. if the oil industry were held accountable, they would have to pay bonds to employ drillers to maintain the concrete on each oil well, forever or at least until the end of the United States. but they are not, so we 've got thousands of wells out there, waiting to become problems as the industry begins its quest of pressurizing the shallow saline layers with CO2.

even if companies figure out how to sequester the CO2, and make sure it doesn't pop out of the million existing boreholes, it may not end up being carbon neutral because of the large amount of energy it takes to compress the CO2, and it may cause new methane leaks emerging from the new boreholes, or how the seismic activity from injection moves fauits, which act on the old borehole population.

But Exxon has gotten back into the Gulf in a major way, with many near-shore leases off Texas, in lease sales 257 and 259, supposedly for CCS waste injection, or CO2 Enhanced Recovery of Oil --supposed "Blue Oil." (bullshit) They have leased OVER 100 Blocks, in areas of high wind potential, close to the major Gulf energy market, Houston. No other lease action in the history of the Gulf, including other CCS leases, requires this much ocean. this is suspicious. The map of Exxon CCS leases looks like a Russian trench network between the Wind leases and Houston.

so it seems like Oil companies can lease the ocean, even places with good Wind potential, and say they are conducting CCS, and preclude Wind from the Gulf.

Right now, Exxon and Cox Operating are the oil companies that, geographically speaking, seem to be pursuing this strategy--leasing the good Wind areas for waste injection. Remember, oil lease sales are for every bit of the ocean. Florida has a moratorium, but anywhere else can be leased by Exxon.

1a) Just squatting on unused oil leases in Areas highly suitable for Wind

There's another kind of geographic blocking that Oil can do---Arena Offshore is another smaller company that has leased areas that have High Wind Potential, ostensibly for oil drilling, but they are not drilling, or even producing on those leases, they are just allowed to squat them. I think some of the Congress were looking into this.

This is more of a problem off Louisiana in Ship Shoal and South Timbalier. There's tons and tons of junk metal out there, that will block Wind implementation if the Oil industry refuses to clean it up. this is their existing barricade of junk. South Timbalier and Ship Shoal are great for Wind, but were not selected for the final sale.

2) related to 1, Wind will not be leased on Oil leases, but I'm unsure if Oil will still be allowed to lease on Wind leases. Please someone tell me that oil leasing will be excluded from the WEA wind planning areas. please prove me wrong. what s the latest sale number? can someone cross reference?


The IRA bill bolsters these BOEM safeguards for the Oil Industry with federal legislation and tax incentives.

a) for every wind lease sale, there must be an oil lease sale. Wind cannot dominate.
b) CCS is absurdly federally subsidized. this is called the 45Q tax credit, even though the oil companies don't have to sequester any carbon to receive the tax subsidies, it's touted as a climate measure.

The US GAO has complained about CCS.
Louisiana downplayed CCS in their climate action plan. that is an absolute coup which may be overturned by the next Governor.

I think US Treasury could and should act on CCS, and conduct a rule-making against CCS/45Q tax fraud. This is probably the biggest politically feasible action we can take to prevent Oil companies from geographically blocking wind out of the Gulf.




This blather above is not as urgent has sheltering the Wind industry in the Gulf from the womb into a cradle. Shell being involved in Wind is comforting, strangely.

but unless we act to stop or regulate these massive subsidies, Big Oil is poised to keep Gulf Wind power stunted for its benefit. Don't be fooled by the people who say that "the market" will favor clean energy, Big Oil has thought of that. it's going to take sustained political pressure to remove the subsidies.
posted by eustatic at 4:10 PM on July 22, 2023 [7 favorites]

This blather above is not as urgent has sheltering the Wind industry in the Gulf from the womb into a cradle. Shell being involved in Wind is comforting, strangely.

Shell and BP are the two oil majors that seem to have put some actual capital into renewable energy. My impression is that this is because they are based in, respectively, the Netherlands and the UK, and those governments, which climate issues seriously, have basically forced them to do so.
posted by Artifice_Eternity at 9:47 PM on July 22, 2023 [2 favorites]

but unless we act to stop or regulate these massive subsidies, Big Oil is poised to keep Gulf Wind power stunted for its benefit. Don't be fooled by the people who say that "the market" will favor clean energy, Big Oil has thought of that. it's going to take sustained political pressure to remove the subsidies.

This is a very tricky needle to thread politically. I think a lot of the subsidies for CCS had to be in the IRA in order to get Manchin to vote for it. I'm honestly not opposed to throwing at least a bit of cash in that direction, as a kind of tariff, to get all the benefits for renewables that are in the legislation. And who knows, they may actually be able to get CCS to work in some way, to some degree... not that I'm holding my breath.

The important thing is that renewables need to keep growing, and rapidly, to become a substantial part of the energy market. As they do, they get cheaper, thanks to economies of scale, and they acquire a broader and stronger base of political support. And that means they'll be in a better position to displace fossil fuels, both thru market competition and thru political influence.
posted by Artifice_Eternity at 9:56 PM on July 22, 2023 [2 favorites]

Thanks, dipflash
posted by theora55 at 1:12 PM on July 24, 2023