"How Big Oil hijacked Germany\u2019s multi-billion-dollar offshore wind auction"

" How Big Oil hijacked Germany\u2019s multi-billion-dollar offshore wind auction \r\n\r\nEuropean oil and gas supermajors \u00a0BP Plc\u00a0 (NYSE:BP) and \u00a0TotalEnergies\u00a0 (NYSE:TTE) have\u00a0 won all of the capacity \u00a0on offer in Germany\u2019s 7GW offshore wind auction, the country\u2019s biggest in history. BP secured leases at two North Sea sites off the coast of Helgoland with total generating potential of about four gigawatts, paying a total of $7.5 billion. The new sites--BP's first offshore wind projects in Germany--will nearly double the company\u2019s global offshore wind pipeline. Meanwhile, TotalEnergies--through local subsidiaries--secured the other two sites for a total of\u00a0 $6.5 billion. Germany currently has 8.4GW of operational offshore wind capacity.\r\n\r\n\u201c These awards are a huge milestone for BP's decarbonization plans in Germany and are a strong reflection of our wider strategy.The renewable power we aim to produce will anchor the significant demand we expect for green electrons for our German operations,\" \u00a0Anja-Isabel Dotzenrath, BP's EVP for gas and low-carbon energy, said.\r\n\r\nBut not everyone is particularly pleased with these giant clean energy projects. Multiple bidders, including the winning bids, pledged to build without any subsidies or state support aka \u2018\u2018negative bidding\u2019\u2019, thus triggering an additional \u201cdynamic bidding procedure\u201d. Negative bidding creates additional costs for offshore wind developers, which they pass on either to the supply chain, already struggling with inflation, or to the consumers, who are grappling with higher electricity prices and costs of living.\r\n\r\n\u201c Crucially the European Union wants to strengthen its energy security with competitive and home-grown renewables. The EU needs as much new wind energy capacity as it can get, as fast as it can get it. All the money paid in negative bidding is money our companies cannot invest in other wind energy projects. European governments should therefore not follow the German example of negative bidding. For example the industrial capacity for the construction of wind turbines, foundations and the installation vessels. But investments are also needed in grids, ports and skilled workers. Negative bidding is unhelpful here. Companies along the wind energy supply chain will have to work with even tighter margins, as developers pass on the extra costs of negative bidding to them, \u201d\u00a0 the trade body said.\r\n\r\n Gulf Of Mexico Gearing For Massive Offshore Wind Scheme \r\n\r\nBack in the United States, the offshore wind sector is beginning to garner some serious attention after receiving more than its fair share of flak by the former president. Last year, the Biden administration outlined\u00a0 a range of clean energy initiatives , key among them plans to hold the\u00a0 largest-ever sale of offshore wind leases \u00a0in U.S. history and accelerate the deployment of new power lines to transmit renewable electricity across the country.\r\n\r\nAt the center of the offshore push was the sale of six commercial leases in the New York Bight between Long Island and New Jersey, the most successful offshore wind lease auction in history. The 488,000 acres offshore wind lease auction fetched a record $4.37 billion from companies looking to develop the waters, with the installed capacity expected to be between 5.6 GW and 7 GW, enough to power 2 million homes. The Department of Energy also launched a\u00a0 Building a Better Grid initiative \u00a0that will tap billions of dollars in funding from the $1T infrastructure law passed in November to finance new lines and grid upgrades.\r\n\r\nWell, the Biden administration is planning to roll out a giant offshore wind project that will dwarf New York Bight.\r\n\r\nAccording to Politico, the U.S. government is\u00a0 considering opening 30 million acres \u00a0of the Gulf of Mexico near Texas and Louisiana to offshore wind energy projects, part of Biden\u2019s goal to build 30 gigawatts of wind power capacity by 2030, enough to power more than 10 million homes.\r\n\r\nAccording to a report by the \u00a0National Renewable Energy Laboratory (NREL) , the U.S. will need more than 2,100 wind turbines, at least 2,100 foundations, more than 11,000 kilometers of cables and five wind turbine installation vessels to achieve its offshore wind energy target. Currently, the country has more than 70,000 existing wind turbines listed in continental U.S.\r\n\r\n Perfect Fit \r\n\r\nThough the Gulf\u2019s waters haven\u2019t sprouted any wind turbines yet, there are several reasons why the Gulf of Mexico is a perfect fit as an offshore wind hub.\r\n\r\nFirst off, the Gulf Coast also has an abundance of companies and workers with decades of experience in producing energy offshore. According to the Energy Information Administration, Gulf of Mexico federal offshore\u00a0 oil \u00a0production accounts for 15% of total U.S. crude oil production. Major fields include Eugene Island block 330 oil field, Atlantis Oil Field, and the Tiber oilfield (discovered 2009) while notable oil platforms include Baldpate, Bullwinkle, Mad Dog, Magnolia, Mars, Petronius, and Thunder Horse.\r\n\r\n\u201cW e have a really mature base for energy. We\u2019ve got the know-how,\u201d Lefton said. The people, the companies, the manufacturers that know how to do [Outer Continental Shelf] energy development are in the Gulf of Mexico, \u201d the Interior Department\u2019s Bureau of Ocean Energy Management director Amanda Lefton has told Politico.\r\n\r\nAccording to Hayes Framme, government relations manager for North America at Danish wind giant\u00a0 \u00d8rsted A\/S \u00a0(OTCPK:DNNGY) , the Gulf\u2019s existing oil and gas infrastructure represents \u201ca historic expertise.\u201d\r\n\r\n\u201c One of the things that makes the Gulf area attractive is the fact that you\u2019ve got a workforce that is accustomed to working on rigs in the ocean. It\u2019s not like you have to build an industry. What you have to do here is basically help an existing industry evolve ,\u2019\u2019 Dennis Arriola, CEO of the renewable energy company\u00a0 Avangrid Inc.\u00a0 (NYSE:AGR), has said.\r\n\r\nMichael Hecht, the president and CEO of\u00a0 Greater New Orleans , says jobs in the Gulf\u2019s traditional oil and gas industry have declined during the past decade, creating a sense of urgency to make a transition that allows people to retain their skills.\r\n\r\nThe Gulf could also become an important hydrogen hub, with wind power being used to generate green hydrogen to reduce greenhouse gas emissions from industries such as long-haul trucking, fertilizer manufacturing and aviation."

"How Big Oil hijacked Germany\u2019s multi-billion-dollar offshore wind auction"

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