LA - Report Touts Louisiana’s Offshore Wind Revenue Potential
Offshore wind power could help power Louisiana economy
NEW ORLEANS — During an Oct. 18 Coastal Protection and Restoration Authority board meeting, researchers released a new report examining the growth potential for wind in the Gulf of Mexico, including estimates of revenue from federal offshore wind lease bids, rents and operating fees. The report, “Winds of Change: Navigating the Gulf of Mexico’s New Energy Frontier,” was created by the Kathleen Babineaux Blanco Public Policy Center at the University of Louisiana at Lafayette and commissioned by Restore the Mississippi River Delta and the Greater Lafourche Port Commission, also known as Port Fourchon.
On Aug. 29, 2023, the Department of the Interior held the first offshore wind energy auction for the Gulf of Mexico, resulting in RWE Offshore US Gulf winning the right to develop a wind farm in the 102,480-acre area offshore Lake Charles with its $5.6 million bid. Officials estimate the area has the potential to generate approximately 1.24 gigawatts of offshore wind energy capacity and power nearly 435,400 homes. Credits included in the bid will result in over $860,000 in investments for workforce training and domestic supply chain and $430,000 for fisheries compensatory mitigation.
In addition to revenues from the initial lease sale, annual rental fees (of $3/acre) and operating fees will be collected by the U.S. Treasury and could be shared with Louisiana, if the Reinvesting in Shoreline Economies and Ecosystems Act is passed. Alternatively, if Congress passed the Budgeting for Renewable Electrical Energy Zone Earnings Act, the revenue from future offshore wind lease sales could be given to the adjacent state.
In both cases, the shared revenues will be put toward eligible uses already established by law, including ecosystem restoration, conservation, hurricane protection, investments in wildlife and fisheries resources, and infrastructure directly affected by coastal wetland loss. Louisiana could further dedicate wind revenue funds to coastal and restoration projects akin to the Gulf of Mexico Energy Security Act, through which federal revenues from oil and gas leases in the Gulf of Mexico are dedicated to the constitutionally protected Coastal Trust Fund and allocated to nearby state and local governments, if pending legislation expands the limits of GOMESA to include wind revenues.
Supporters of offshore wind energy include partner organizations Restore the Mississippi River Delta, the University of Louisiana at Lafayette Kathleen Babineaux Blanco Public Policy Center, the Coastal Protection and Restoration Authority and Greater Lafourche Port Commission.
“This is a historic time for Louisiana,” said Simone Maloz, campaign director of Restore the Mississippi River Delta, in a release. “We are making more progress than ever before in restoring and protecting our coast, but it will take significant funding to continue with this momentum. The potential revenues generated by wind off our coast could provide funding for coastal infrastructure and resiliency to protect vulnerable communities and businesses most impacted by our changing coast.”
“Wind offers an exciting opportunity for developing new energy resources in the Gulf of Mexico,” said Dr. Stephen Barnes, director and associate professor of economics for the Blanco Center. “The robust offshore workforce, shallower waters and established marine industry provide valuable support for development of Gulf of Mexico wind projects.”
