A German energy company won rights Tuesday to the first-ever offshore wind lease in the Gulf of Mexico, bidding $5.6 million for 102,480 acres in federal waters off the coast of southwest Louisiana.
The winning bidder, RWE, is a Germany-based holding company engaged in electricity generation and storage systems. It has experience with a wide range of renewable energies and is one of the world’s largest offshore wind developers.
The lease off the coast of Lake Charles has the potential to generate approximately 1.24 gigawatts of wind energy―enough to power nearly 435,400 homes, according to the U.S. Bureau of Ocean Energy Management.
Two other areas up for auction received no bids. The Gulf lease result stands in contrast to other recent auctions off the coasts of New Jersey, California and the Carolinas that attracted billions. Those states and others have required utilities to diversify their energy sources with renewables.
Louisiana’s utility companies, which rely largely on natural gas, have until now been slower to make significant investments in renewables. RWE and Entergy Louisiana developed a partnership earlier this year to support offshore wind development.
Simon Mahan, executive director of the Southern Renewable Energy Association, says the next steps for RWE will be to conduct site assessments for the next few years and determine if there’s an appetite to move forward with construction.
“Expanding the transmission system will be vitally important to connect these offshore wind resources to Louisiana,” Mahan says.
This story was first published by Louisiana Illuminator.