Shell aims to sell offshore wind power into US northeast

Oil major is considering bidding for leases for offshore wind zone facing New York and Massachusetts

Oil major Shell wants to win an offshore wind lease zone facing New York or Massachusetts, and participate in upcoming offshore wind procurements in those states.

“We’re right now very much active in investigating the upcoming lease opportunities, both in Massachusetts and New York,” says John Hartnett, business opportunity manager for US offshore at Shell WindEnergy.

“We’re very hopeful to have site control in time to participate in the upcoming auctions,” Hartnett told the US Offshore Wind conference in Boston on Thursday.

Later this year the federal government will auction off two more zones south of Massachusetts, and by next summer the state will launch its second offshore wind RFP. This week Matthew Beaton, Massachusetts’ secretary for energy and the environment, said he believes it’s likely the state will eventually increase its binding 1.6GW offshore wind target.

Meanwhile, New York plans to issue solicitations for at least 800MW of offshore wind in 2018 and 2019, and the federal government is in the process of preparing a possible lease auction in the New York Bight, an area facing Long Island and New Jersey, with the auction to come as soon as next year.

While Norway’s Equinor holds a strong hand in New York’s early solicitations given the location of its Empire Wind project, won in a 2016 lease auction, the state has said it’s open to procuring capacity from zones facing other states in the region – from Massachusetts down to New Jersey.

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Among the world’s largest hydrocarbon companies, Royal Dutch Shell made a dramatic return to the offshore wind sector several years ago, at the head of a consortium that won a contract for 700MW of capacity off the Netherlands.

Shell is also pushing into solar energy, including announcing an agreement earlier this year to buy a nearly 44% stake in US-based solar developer Silicon Ranch Corp. for up to $217m.

After being active in the European offshore wind, the company has now “really jumped into the US market”, says Hartnett, who is based in New York. “We really want to help support the development of this industry in the US.”

Shell received regulatory approval to participate in the last US offshore wind lease auction, for the Kitty Hawk zone off North Carolina last year, but ultimately decided not to bid. Iberdrola’s Avangrid Renewables won that auction.