Senate reconciliation bill would lift US Southeast offshore wind moratorium

Senate reconciliation bill would lift US Southeast offshore wind moratorium

Abbie Bennett

Energy

An effective 10-year ban on offshore wind leasing in much of the U.S. Southeast would be lifted under the Senate-passed Inflation Reduction Act.

As of July 1, a moratorium prevents offshore wind leasing off the coasts of North Carolina, South Carolina, Georgia and Florida. The massive budget reconciliation package would reverse the ban and open the region to federal offshore leases once again. The Inflation Reduction Act, or IRA, narrowly passed the Senate on Aug. 7 and includes nearly $370 billion in climate and energy spending.

Former President Donald Trump issued two executive orders in 2020 that effectively prevented "any leasing purposes of exploration, development or production" in federal waters in the eastern Gulf of Mexico and off the coasts of Florida, Georgia, South Carolina and North Carolina for 10 years and included oil, gas and wind resources. The orders extended and expanded the geographic scope of a moratorium on offshore leasing from 2006. Leases that existed before the effective date of July 1 were not affected.

The IRA measure would allow the secretary of the U.S. Interior Department to "grant leases, easements and rights-of-way ... in an area withdrawn by" the 2020 executive orders.

"The repeal of the 10-year offshore wind moratorium in the Inflation Reduction Act is exciting and welcome news," said Rep. Deborah Ross, D-N.C., who sponsored legislation to reverse the ban. "Since coming to Congress, I have fought to overturn the moratorium, and I am excited that we are finally getting it done. Offshore wind energy represents one of the best options in our toolbox to reach our clean energy goals."

The IRA is headed to the House of Representatives, which appears likely to pass the proposal.

"These provisions represent a historic climate investment and help to bring the Southeast closer to capturing the massive economic and climate benefits of offshore wind," Southeastern Wind Coalition President Katharine Kollins said.

"This policy is going to essentially lift a barrier on accessing tremendous amounts of clean energy resources for the Southeast states," said Chris Carnevale, climate advocacy director for the Southern Alliance for Clean Energy. "What was left on the table because of this moratorium were areas across the Southeast capable of accommodating many gigawatts of offshore wind that will go a long way to helping states construct clean energy portfolios. A decade is a long time to have a moratorium for a nascent industry."

While carbon reduction and cleaner generation are growing priorities for southeastern U.S. states, the moratorium took offshore wind off the table for the next decade. North Carolina, which has some of the greatest offshore wind generating potential in the region, designated several areas off its coast for wind generation. Avangrid Inc. leased acreage in 2017 for its planned 2,500-MW Kitty Hawk Offshore Wind Farm. More recently, on May 11, Duke Energy Corp. and TotalEnergies SE won the bidding for two offshore wind lease areas covering 110,091 acres off the coast of the Carolinas. But those lease areas were the last in the region as the moratorium set in.

"The former administration's arbitrary offshore wind leasing moratorium would stifle the growth of our clean energy economy in North Carolina and throughout the region," Ross said. "Our state is perfectly positioned to lead this multibillion-dollar industry, with our offshore wind energy generation potential and a capable manufacturing workforce ready to embrace this opportunity."

Other efforts

The IRA is the latest of several efforts by lawmakers and the Biden administration to reverse the ban.

On July 14, the House passed a bipartisan amendment to the National Defense Authorization Act that would lift the 10-year ban.

The measure was introduced as a stand-alone bill in 2021 and was added to the National Defense Authorization Act as an amendment led by Ross and Reps. Paul Tonko, D-N.Y., and David Rouzer, R-N.C. The defense legislation is an annual bill that typically sets guidelines for defense policy but also often includes Energy Department policy. The fiscal year 2023 House proposal, which totals $839 billion, passed in a 329-101 vote July 14. House and Senate leaders will work to craft a compromise bill, aiming to pass the final version by year-end. It is unclear if the measure to overturn the moratorium will be included in that final version.

President Joe Biden on July 20 announced new actions his administration will take to combat climate change, including encouraging the Interior Department to advance clean energy development off the coasts of the states covered under the moratorium. But it has so far been unclear whether an executive order alone would be enough to undo the ban, and Congressional staff said they still planned to pursue a legislative solution.

If allowed to continue, the moratorium could make it more difficult for certain states to reach decarbonization goals and could halt the nascent industry seemingly gaining ground in the region. The moratorium could also limit offshore wind development beyond its 2032 expiration since projects often take years to develop from lease sale to operation.

Biden has set a goal for the U.S. to deploy 30 GW of offshore wind power by 2030, part of a target to decarbonize the electricity sector by 2035.