Norwegian-based Equinor wins wind farm lease off the coast of Sussex County

Norwegian-based Equinor won a provision lease bid for a wind farm off the coast of Sussex County. | PHOTO COURTESY OF UNSPLASH/SHAUN DAKIN

SUSSEX COUNTY — A Norwegian-based energy company says it’s ready to set wind to future plans just off the coast of Delaware after it won a provisional wind energy lease in an auction from the Bureau of Ocean Energy Management (BOEM).

According to a press release from Equinor, the company won the bid Wednesday, Aug. 14 at $75,001,001 for 101,443 acres in the Atlantic Ocean just 26 miles from the mouth of the Delaware Bay.

President of Equinor Renewables Americas Molly Morris said in the press release, “Equinor is pleased to have been selected as the provisional winner of the Central Atlantic offshore wind lease auction. Equinor’s interest in this auction is consistent with our approach to pursue attractive offshore wind opportunities in the United States. The Central Atlantic region has a rapidly growing demand for electricity with widespread support for adding renewable sources of energy into the power mix.”

A new deal

Equinor’s bid and subsequent lease would ultimately generate two gigawatts (GW) of energy, helping to power nearly 900,000 homes in the United States with energy created by wind turbines which are yet to be installed. According to the United States Census Bureau, Delaware currently has 448,735 housing units and 28,553 employer establishments.

The new wind farm would enhance not only the Delmarva Penisula, but would add to the Norwegian company’s portfolio which already includes several other provisional wins from wind energy auctions in areas like New York and California. Across the ocean in England, the company boasts what could become the world’s largest offshore wind farm which will include 277 wind turbines in the North Sea powering up six million British homes, according to the company.

Its winning bid for the area just east of Rehoboth Beach won alongside another project set for the East Coast – Virginia-based Dominion Energy won a $17.7 million bid to lease 176,505-acres off the coast of Virginia Beach and just over 35 miles off the mouth of the Chesapeake Bay, hoping to provide 2.6 GW of power through the Coastal Virginia Offshore Wind Project.

Residents and businesses in the Delaware and nearby coastal areas may see power from Equinor’s wind farm a decade from now. Executive Vice President of Equinor Renewables Pål Eitrheim said the company vows to “take a disciplined approach to minimize risk and mature a robust project in our portfolio.”

Eitrheim said, “[The] announcement underscores Equinor’s commitment to delivering value through renewable projects. This is a long-term option with the first power post 2035. Developing this lease area will draw upon Equinor’s proven capabilities in offshore wind. We will take a disciplined approach to minimize risk and mature a robust project in our portfolio.”

Changes in the wind

Both companies will have to work directly with BOEM to certify the leases, as well as request regulatory approvals prior to construction and other work at the sites. The leases offer Equinor and Dominion the opportunity to submit project plans for the BOEM’s review. From there, an Environmental Impact Statement will be developed for each site, analyzing local impacts, before any decision can be made, according to the press release from BOEM.

“[The] lease sale[s] represent a major milestone in meeting the demand for clean renewable energy along the East Coast,” BOEM Director Elizabeth Klein said in a press release. “BOEM remains committed to responsible offshore wind energy development 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.”

That demand for clean, renewable energy will only continue to grow in Delaware, a welcomed change for some like The Nature Conservancy’s Delaware Director of Government Relations Emily Knearl.

“With last year’s House Bill 99, Delaware set a goal to reduce greenhouse gas emissions by 50% by 2030 and achieve net zero by 2050. We cannot meet the state emissions-reduction goal without offshore wind energy,” she told the Delaware Business Times in a prepared statement. 

More recently, the state is now awaiting Governor John Carney’s signature on Senate Bill 265 which was passed by both the house and senate after a significant amount of discussion on both ends of the spectrum. The bill, dubbed the Energy Solutions Act of 2024, comes on the tailwinds of the Climate Change Solutions Act of 2023 which demanded an increase in net zero, or greenhouse gas emission, goals.

SB 265 ultimately authorizes Delaware’s Department of Natural Resources and Environmental Control (DNREC) and the state Public Service Commission to purchase 800 to 1,200 megawatts of renewable energy, among other requirements.

“This is important because simply leasing offshore wind off the coast of Delaware does not mean that this form of clean energy will serve the First State,” Knearl told DBT. “SB 265 paves the way for offshore wind to be added to the Delaware electricity grid. It also includes important language requested by TNC that requires that any wind project must address conservation and mitigation elements — essentially the idea that offshore wind construction must reduce potential environmental impacts and provide investments in natural habitats.”

Acting on energy needs

Leaders like Knearl are hopeful that the renewable energy demands set in motion by Delaware legislators in recent years will be realized sooner rather than later. 

“The Nature Conservancy (TNC) supports the rapid and sustainable development of offshore wind projects that avoid potential impacts to habitat and species through the use of the best data available, mitigation strategies and engagement with key stakeholders,” she told DBT. “While we do not endorse specific Mid-Atlantic offshore wind projects, this area is well positioned to provide offshore wind power due to the size of the continental shelf and consistent winds, and the federal government leasing these spaces is an important step forward toward a clean energy future.

Despite a drive to do better by the environment, some companies have experienced economic difficulties in getting these projects off the ground. 

Offshore wind developer Ørsted, primarily owned by the Danish government, announced it would withdraw its Skipjack project off of the Delaware Peninsula coast earlier this year in January, citing high inflation and interest rates. It had previously leased about 80,000 acres for the project from the BOEM. 

Meanwhile, Equinor now remains steadfast in its commitment to its recent bid and provisional lease award located in roughly the same area. 

“Going forward, we will work with BOEM to certify the deal and after that, start an ordinary project maturation work where we [will] develop a technological and financial fundament based on the lease we have been granted,” Renewables, Marketing and Midstream Press Spokesperson Magnus Frantzen Eidsvold told the Delaware Business Times in a prepared statement. “The United States remains a core market for Equinor’s offshore wind activities and this lease is a long-term opportunity in an attractive region.”