Dept. of Interior Signs First-Ever Offshore Wind Energy Lease in U.S.

Cape Wind signs 28-year offshore wind energy lease

It's officially official. After eight years of scoping, studying, permitting, legislating and legal wrangling, the United States today cemented its first-ever lease for an offshore wind farm on the Outer Continental Shelf.

At the inaugural North American Offshore Wind Conference & Exhibition in Atlantic City, New Jersey, U.S. Secretary Ken Salazar and Cape Wind Associates, LLC, signed the nation’s first lease for commercial offshore wind energy development on the OCS.

“The signing of this lease sends an important market signal to the offshore wind industry that the United States is ready to move forward and that Cape Wind will be the first of many offshore wind projects in this country,” said Jim Gordon, President of Cape Wind.

The 468-megawatt Cape Wind project, which won final approval in April, will have an average output of 182 megawatts, or 75 percent of the electricity demand for Cape Cod, Martha's Vineyard and Nantucket Island combined.

“We’re ready to roll up our sleeves and get to work building America’s first offshore wind farm that will create hundreds of jobs, increase our energy independence and promote a healthier and more hopeful energy future,” Gordon said.

The lease authorizes Cape Wind to construct the 130 turbine offshore wind farm on Horseshoe Shoal in Nantucket Sound, and to operate the facility for a period of 28 years. The company will be paying a lease fee ranging from 2 percent to 7 percent during production.

"Under the leadership of President of Obama, the renewable energy world is opening a new frontier," said Interior Secretary Ken Salazar in his keynote address at the conference before signing the Cape Wind lease.

Last month the U.S. Department of Energy unveiled a draft plan that calls for the U.S. to install 54,000 megawatts of offshore wind power capacity by the year 2030, which would require more than 100 Cape Wind-sized projects.

"If we fully pursue our potential for wind energy on land and offshore, wind can generate as much as 20 percent of our electricity by 2030 and create a quarter-million jobs in the process," Secretary Salazar said.

Salazar cited Cape Wind as a pioneer for offshore wind energy development in the U.S. and went on to explain how the long regulatory and permitting battle to approve the wind farm helped pave the way for a new streamlined permitting process for renewable energy on public lands. And just yesterday, the Department of the Interior approved the first two projects from this fast-track process.

The two large-scale solar projects in California are the first to be approved on public lands and together they will generate over 700 megawatts of power, and are among the world's largest solar power plants.

In the coming weeks and months, the Department of the Interior has plans to finalize several major wind, solar, geothermal, and transmission energy projects in western states.

The goal is to get them reviewed by the end of 2010, when they can take advantage of the incentives made available by the Recovery Act.

"The renewable energy potential on America’s public lands is staggering," Secretary Salazar said.