US says interest in two new Gulf of Mexico wind projects warrants 2026 auction

The US Interior Department has determined that two offshore wind companies' interest in acquiring leases in the Gulf of Mexico is enough to warrant holding an auction in 2026. This follows questions over the viability of future offshore wind lease sales in the region after the previous auction's lackluster response in 2023.

The US Bureau of Ocean Energy Management (BOEM) announced its determination Dec. 12, setting the date for the next Gulf of Mexico auction for "as soon as 2026." It will also draft other wind energy areas in the Gulf in 2025 where other potential lease auctions could be held.

The agency's determination of competitive interest for two wind energy areas it had previously designated in the Gulf was scheduled to be published in the Federal Register Dec. 13. The review was spurred by the unsolicited request by independent power producer Hecate Energy in February, stating its interest in acquiring a commercial wind energy lease in the two areas. The company has proposed building a 2-GW wind farm in the Gulf.

However, it remains unclear whether the auction, or the designation of any new wind areas, will occur, given President-elect Donald Trump's statements that he would stop offshore wind approvals once he is sworn in on Jan. 20, 2025.

Nevertheless, BOEM Gulf of Mexico Regional Director Jim Kendall issued an optimistic statement, calling the Gulf an "attractive option" for offshore wind development. The agency added that it will continue to evaluate expressions of interest by other companies moving forward.

A spokesperson for the industry trade group American Clean Power Association said in an email that growing commercial interest in offshore wind in the Gulf of Mexico "is a win for American jobs, US shipbuilding and American energy security."

Hecate's expression of interest spurred Chicago-based independent power producer Invenergy to inform BOEM that it too was interested in acquiring leases in the Gulf. Invenergy stated its interest in July when responding to BOEM's publishing a formal request for competitive interest, seeking comment on Hecate's lease request.

BOEM said that based on the interest in holding a second auction, it has deemed both Hecate and Invenergy to be legally, technically and financially qualified to hold a renewable energy lease in the Gulf of Mexico.

It further explained that it will move forward with the competitive lease process and proceed to hold the next offshore wind lease sale in the Gulf of Mexico in 2026. The next step in this process will be to continue to analyze other interested parties that submitted comments in response to the request for competitive interest.

It will evaluate which portions of the wind energy areas, designated as options C and D, together with other potential lease options, are best suited for sale. BOEM plans to release draft wind energy area proposals for public comment in early 2025.

Currently, the two wind areas that both companies are interested in are located less than 25 miles from the coastal town of Beeville, Texas, covering a combined area of approximately 142,000 acres, in depths that are suitable for fixed-bottom wind turbines. Hecate's proposed Gulf Wind 2 project calls for the installation of 133 turbines to produce up to 2 GW of capacity. The company has already begun the process of securing land in Texas for onshore substations.

Hecate has no operational offshore wind assets and a portfolio comprising mainly solar and energy storage resources. The company is 40% owned by Spanish oil giant Repsol SA, which could offer paths to securing financing and expertise in both the Gulf of Mexico and offshore wind development.

Invenergy's proposal is similar to that of Hecate, calling for the installation of up to 140 turbines with a capacity of 15 MW or above, for a total capacity of up to 2.5 GW. Invenergy, which has a global portfolio of wind, solar, storage and natural gas resources, holds two wind leases off the coasts of New Jersey and California, although neither is approaching the development phase yet. So far, only one offshore wind lease has been awarded in the Gulf of Mexico.

RWE AG was the sole winner of the first lease sale in 2023, submitting a $5.6 million offer for the Lake Charles Lease Area offshore Louisiana. If its planned development proceeds, it could generate up to 1.24 GW and reach commissioning in the mid-2030s.