Notice2024-05955
Gulf of Mexico Wind Lease Sale (GOMW-2) for Commercial Leasing for Wind Power on the Outer Continental Shelf Offshore in the Gulf of Mexico-Proposed Sale Notice
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 21, 2024
Issuing agencies
Interior DepartmentOcean Energy Management Bureau
Abstract
The Bureau of Ocean Energy Management (BOEM) proposes to hold Gulf of Mexico Wind Lease Sale (GOMW-2) for multiple lease areas (Lease Areas) using a multiple-factor bidding auction format. BOEM will use new auction software for the lease sale, resulting in changes to its previous auction rules. This Proposed Sale Notice (PSN) contains information pertaining to the areas available for leasing, certain lease provisions and conditions, auction details, lease forms, criteria for evaluating competing bids, award procedures, appeal procedures, and lease execution procedures. The issuance of any lease resulting from this sale would not constitute approval of project-specific plans to develop offshore wind energy. Such plans, if submitted by the Lessee, would be subject to subsequent environmental, technical, and public reviews prior to a BOEM decision whether or not to approve them.
Full Text
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<title>Federal Register, Volume 89 Issue 56 (Thursday, March 21, 2024)</title>
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[Federal Register Volume 89, Number 56 (Thursday, March 21, 2024)]
[Notices]
[Pages 20234-20247]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-05955]
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DEPARTMENT OF THE INTERIOR
Bureau of Ocean Energy Management
[Docket No. BOEM-2024-0017]
Gulf of Mexico Wind Lease Sale (GOMW-2) for Commercial Leasing
for Wind Power on the Outer Continental Shelf Offshore in the Gulf of
Mexico--Proposed Sale Notice
AGENCY: Bureau of Ocean Energy Management, Interior.
ACTION: Proposed sale notice; request for comments.
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SUMMARY: The Bureau of Ocean Energy Management (BOEM) proposes to hold
Gulf of Mexico Wind Lease Sale (GOMW-2) for multiple lease areas (Lease
Areas) using a multiple-factor bidding auction format. BOEM will use
new auction software for the lease sale, resulting in changes to its
previous auction rules. This Proposed Sale Notice (PSN) contains
information pertaining to the areas available for leasing, certain
lease provisions and conditions, auction details, lease forms, criteria
for evaluating competing bids, award procedures, appeal procedures, and
lease execution procedures. The issuance of any lease resulting from
this sale would not constitute approval of project-specific plans to
develop offshore wind energy. Such plans, if submitted by the Lessee,
would be subject to subsequent environmental, technical, and public
reviews prior to a BOEM decision whether or not to approve them.
DATES: Comments must be submitted electronically or postmarked received
by BOEM no later than May 20, 2024. All comments received or postmarked
during the comment period will be made available to the public and
considered prior to publication of the Final Sale Notice (FSN).
For prospective bidders who wish to participate in this lease sale:
Unless you have received confirmation from BOEM that you are qualified
to participate in the GOMW-2, BOEM must receive your qualification
materials no later than May 20, 2024, and, prior to the auction, BOEM
must confirm your qualification to bid in the auction.
ADDRESSES: Potential auction participants, Federal, State, and local
government agencies, Tribal governments, and other interested parties
are requested to submit written comments on the PSN in one of the
following ways:
<bullet> Electronically: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. In the search
box, enter ``BOEM-2024-0017'' and click ``Search.'' Follow the
instructions to submit public comments.
<bullet> Written Comments: Submit written comments in an envelope
labeled ``Comments on GOMW-2 Lease Sale PSN'' and delivering them by
U.S. mail or other delivery service to Bureau of Ocean Energy
Management, Office of Leasing and Plans, 1201 Elmwood Park Boulevard,
New Orleans, Louisiana 70123.
Qualifications Materials: To qualify to participate in a lease sale
following the publication of this PSN, qualification materials should
be developed in accordance with the following guidelines (<a href="https://www.boem.gov/Renewable-Energy-Qualification-Guidelines/">https://www.boem.gov/Renewable-Energy-Qualification-Guidelines/</a>) and submitted
to Renee Bigner, Bureau of Ocean Energy Management, Office of Leasing
and Plans, 1201 Elmwood Park Boulevard, New Orleans, Louisiana 70123 or
electronically to <a href="/cdn-cgi/l/email-protection#b7c5d2d9d2c0d6d5dbd2d2d9d2c5d0ced0d8dac5f7d5d8d2da99d0d8c1"><span class="__cf_email__" data-cfemail="f381969d968492919f96969d9681948a949c9e81b3919c969edd949c85">[email protected]</span></a>. If you wish to protect
the confidentiality of your comments or qualification materials,
clearly mark the relevant sections and request that BOEM treat them as
confidential. Please label privileged or confidential information with
the caption ``Contains Confidential Information'' and consider
submitting such information as a separate attachment. Treatment of
confidential information is addressed in section XXI, ``Protection of
Privileged or Confidential Information.'' Information that is not
labeled as privileged or confidential will be regarded by BOEM as
suitable for public release.
FOR FURTHER INFORMATION CONTACT: Renee Bigner, Bureau of Ocean Energy
Management, Office of Leasing and Plans, 1201 Elmwood Park Boulevard,
New Orleans, Louisiana 70123, (504) 736-7623 or <a href="/cdn-cgi/l/email-protection#bbc9ded5dede95d9d2dcd5dec9fbd9d4ded695dcd4cd"><span class="__cf_email__" data-cfemail="691b0c070c0c470b000e070c1b290b060c04470e061f">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
Request for Interest: On June 11, 2021, BOEM published a Request
for Interest (RFI) for commercial leasing for wind power development on
the Gulf of Mexico OCS. The RFI Area comprised the entire Central
Planning Area (CPA) and Western Planning Area (WPA) of the Gulf of
Mexico, excluding the portions of those areas located in water depths
greater than 1,300 meters. BOEM received 39 comments from the general
public; Federal, State and local agencies; the fishing industry;
industry groups; developers; Non-Governmental Organizations (NGOs);
universities; and other stakeholders. The subjects receiving the most
comments were fisheries and marine mammals. Five developers submitted
indications of interest for a commercial wind energy lease within the
RFI Area in response to the RFI.
Call for Information and Nominations: On November 1, 2021, BOEM
published the Call for Information and Nominations--Commercial Leasing
for Wind Power Development on the Outer Continental Shelf in the Gulf
of Mexico.\1\ The Call Area comprised the area located seaward of the
Gulf of Mexico Submerged Lands Act Boundary, bounded on the east by the
north-south line located at -89.857[deg] W longitude, and bounded on
the south by the 400-meter bathymetry contour and the U.S. Mexico
Maritime Boundary established by the Treaty between the Government of
the United States of America and the Government of the United Mexican
States on the Delimitation of the Continental Shelf in the Western Gulf
of Mexico beyond 200 Nautical Miles (U.S.-Mexico Treaty), which took
effect in January 2001. BOEM received 40 comments from the general
public, Federal, State, and local agencies, fishing industry, industry
groups, developers, NGOs, universities, and other stakeholders. The
subjects receiving the most comments were fisheries and marine mammals.
Five developers nominated areas for a commercial wind energy lease
within the Call Area in response to the Call.
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\1\ <a href="https://www.boem.gov/83-FR-15602/">https://www.boem.gov/83-FR-15602/</a>.
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GOMW-1 Area Identification: After the close of the Call comment
period on December 16, 2021, BOEM initiated the Area Identification
(Area ID) process by reviewing the input received to date. On July 20,
2022, BOEM announced it was seeking public comments on two preliminary
WEAs. The first WEA was located approximately 24 nautical miles (nm)
off the coast of Galveston, TX, covered a total of 546,645 acres, and
had the potential to power 2.3 million homes with clean wind energy.
The second WEA was located approximately 56 nm off the coast of Lake
Charles, LA, covered a total of 188,023 acres, and had the potential to
power 799,000 homes. The public comment period was open for 30-calendar
days.
For purposes of recommending the Preliminary WEAs, BOEM considered
[[Page 20235]]
the following non-exclusive list of information sources: comments and
nominations received on the RFI and Call; information from the GOM
Intergovernmental Renewable Energy Task Force; input from Alabama,
Mississippi, Louisiana, and Texas State agencies; input from Federal
agencies, e.g., Department of Defense (DoD), and U.S. Coast Guard
(USCG); comments from stakeholders and ocean users, including the
maritime community, offshore wind developers, and the commercial
fishing industry; State and local renewable energy goals; and
information on domestic and global offshore wind market and
technological trends.
BOEM received ocean users' feedback requesting BOEM to consider
using an existing ocean planning model previously used in the GOM for
the National Oceanic and Atmospheric Administration's (NOAA)
Aquaculture Opportunity Areas for ocean planning purposes. In response,
BOEM used the ocean planning model to help support the identification
of Preliminary WEAs.
BOEM's process to identify Preliminary WEAs in the GOM was based on
rigorous science, detailed in the ``A Wind Energy Area Siting Analysis
for the Gulf of Mexico Call Area'' report (<a href="https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/GOM-WEA-Modeling-Report-Combined.pdf">https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/GOM-WEA-Modeling-Report-Combined.pdf</a>), to drive an informed, forward-looking,
and sustainable industry to maximize operational efficiency and limit
adverse interactions with other industries or natural resources.
Additionally, BOEM's Gulf of Mexico Regional Office (GOMR) and the NOAA
National Centers for Coastal Ocean Science (NCCOS) collaborated in
using an ocean planning tool to identify Preliminary WEAs on the U.S.
OCS in the GOM. Preliminary WEAs were identified, based on the best
available science and through public engagement, to facilitate wind
energy development; support environmental, economic, and social
sustainability; and minimize resource use conflicts. The WEA process
seeks to identify and minimize potential conflicts in ocean space as
well as mitigate interactions with other users and adverse interactions
with the environment; the NCCOS model is a tool to help support that
effort.
Planning and siting for the WEAs required thorough synthesis and
spatial analyses of critical environmental data and ocean space use
conflicts. BOEM used Geographic Information Systems (GIS) to integrate
pertinent spatial data, perform analyses, and generate map-based
products to inform where potential wind energy area(s) would be located
within the Call Area. BOEM sought to identify wind energy areas in a
manner that avoids or minimizes impacts on environmental resources. The
use of this NCCOS model is one approach to meet that objective.
BOEM has engaged in similar ocean planning efforts in other OCS
Regions. Ocean planning processes often follow a standard workflow
through (1) identification of the planning objective, (2) inventory of
data, (3) geospatial analysis of data, (4) interpretation of results,
and (5) delivery of map products and reports to decisionmakers and
other ocean users. Spatial data are used to represent known or
potential environmental and ocean space use conflicts that could
constrain, or conditionally constrain, the siting of offshore wind
facilities on the U.S. OCS. Using a multi-criteria decision approach
allows for evaluation of numerous spatial data types for an area and
provides a relative comparison of how suitable the areas are for
offshore wind development. Additionally, natural and cultural
resources, industry and operations, various fishing activities,
logistics, economics, and national security are described and
identified in the WEA model suitability analysis, which is discussed in
detail in the Gulf of Mexico Wind Energy Area Modeling Report (<a href="https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/GOM-WEA-Modeling-Report-Combined.pdf">https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/GOM-WEA-Modeling-Report-Combined.pdf</a>).
Additionally, WEA siting informed by ocean planning is helpful in
avoiding and minimizing adverse environmental, social, and existing
user interactions. Throughout the Area ID process, BOEM used existing
datasets to facilitate discussions with ocean users to receive early
feedback. BOEM incorporated the feedback from ocean users in the
spatial and temporal planning strategies to allow initial compatibility
to be assessed while also increasing the efficiency of meaningful
communications within and among stakeholders and potentially with
industry. The Preliminary WEAs resulting from this analysis are then
considered by the decisionmaker to inform the siting of offshore wind.
After the close of the Preliminary WEA comment period on September
2, 2022, BOEM finalized the Area ID process by reviewing the input
received from all stakeholders mentioned above.
BOEM completed the Area ID on October 31, 2022, by identifying the
following WEAs within the Call Area: Louisiana Coast Region (Lake
Charles WEA) and the Texas Coast Region (Galveston WEA). The Area ID
announcement and a map of the WEAs are available at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
GOMW-2 Area Identification: Offshore wind developers requested that
BOEM offer more acreage in the GOM east of Wind Energy Area (WEA) I for
leasing. A GOMW-2 sale (combined with GOMW-1) would offer sufficient
acreage for leasing to allow for robust development to help meet the
State of Louisiana's goal of five GW of offshore wind. BOEM did not
issue the GOMW-2 Preliminary WEAs for comment but, to maintain
transparency, BOEM sought input from stakeholders through outreach.
From June through August 2023, BOEM engaged with Federal partners,
federally recognized Tribes, the affected States, as well as other
stakeholders and ocean users, to solicit input and feedback on the 11
remaining WEA Options. On August 2, 2023, BOEM held a ``round table''
meeting with major stakeholders to gather input and answer questions on
wind development in the GOM and have continued the outreach and
engagement conversations to date. BOEM considered and incorporated
comments received into the recommendation of these Final WEAs. New data
was solicited and reviewed from stakeholders, and BOEM determined that
the NCCOS Model, finalized in May 2022, remains the best available
model for deconflicting space use considerations. Substantive comments
underscored the need to minimize potential impacts to the fisheries
industry, consider USCG and DoD missions and potential concerns, and
provide sufficient WEA acreage for economic viability. Based on this
input, BOEM removed from consideration the WEAs with mid to high levels
of potential shrimping impacts and WEA Options with less than 90,000
acres, with the exception of WEA Option N. WEA Option N is being
recommended as a final WEA based on potential economic viability due to
its proximity to the existing Lake Charles lease area. Therefore, BOEM
finalized WEAs J, K, L and N. WEA I, designated as a final WEA for
GOMW-1, remains available for leasing.
Environmental Reviews: On January 11, 2021, BOEM published a notice
of intent to prepare an environmental assessment (EA) to consider
potential environmental consequences of site characterization
activities (e.g., biological, archaeological, geological, and
geophysical surveys and core samples) and site assessment activities
(e.g., installation of meteorological buoys) that are expected to take
place after issuance of wind energy leases in
[[Page 20236]]
the Call Area. As part of the scoping process for the EA, BOEM sought
comments on the issues and alternatives that should inform the EA. BOEM
received 18 comments, which can be found at <a href="https://www.regulations.gov">https://www.regulations.gov</a>
under Docket No. BOEM-2021-0092. In addition to the preparation of the
Draft EA, BOEM completed consultations under the Endangered Species Act
(ESA) and the Magnuson-Stevens Fishery Conservation and Management Act
(MSFCMA). On July 20, 2022, BOEM issued a press release soliciting
comments on the Draft EA. During the comment period, BOEM held two
virtual public meetings, one on August 9, 2022, and another on August
11, 2022. BOEM published the Final EA and Finding of No Significant
Impact (FONSI) on May 26, 2023. These documents can be found at <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
BOEM is also conducting environmental review, as well as consultation
under the Coastal Zone Management Act (CZMA), prior to the GOMW-2
auction. BOEM will conduct additional environmental reviews upon
receipt of a Lessee's Construction and Operations Plan (COP) if one or
more leases are issued and reach that stage of development. Offshore
site assessment and site characterization activities proposed for the
purpose of hydrogen, other than those covered in the GOM Wind Lease EA,
will also be reviewed at a site-specific and on a case-by-case basis by
BOEM. Lessees should coordinate with the BOEM Gulf of Mexico Regional
Office before developing a survey plan.
II. Area Proposed for Leasing
BOEM proposes four areas for the GOMW2 lease sale. The areas
proposed for leasing will be auctioned as WEA I-1 Lease OCS-G37962, WEA
I-2 Lease OCS-G37963, WEA J-1 Lease OCS-G37964, and WEA K-1 Lease OCS-
G37965. BOEM chose these lease areas as the most viable options due to
their ranking in the suitability modeling, their proximity to shore,
and stakeholder feedback.
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Lease area name Lease area ID Acres
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WEA I-1........................ OCS-G 37962............ 102,500
WEA I-2........................ OCS-G 37963............ 96,786
WEA J-1........................ OCS-G 37964............ 108,230
WEA K-1........................ OCS-G 37965............ 102,544
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Total...................... ....................... 410,060
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Descriptions of the proposed Lease Areas can be found in Addendum
``A'' of the proposed leases, which BOEM has made available with this
notice on its website at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
a. Map of the Area Proposed for Leasing: A map of the Lease Areas,
and GIS spatial files X, Y (eastings, northings) UTM Zone 18, NAD83
Datum, and geographic X, Y (longitude, latitude), NAD83 Datum can be
found on BOEM's website at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
Potential Future Restrictions to Ensure Navigational Safety:
USCG Navigational Safety Measures: Potential bidders should note
that portions of the GOM may not be available for future development
(i.e., installation of wind energy facilities) because of navigational
safety concerns. The USCG recommends that BOEM add a 2-nautical mile
(3704 meter) buffer around the shipping fairways. BOEM may require
additional mitigation measures at the COP stage when the lessee's site-
specific navigational safety risk assessment is available to inform
BOEM's decision-making.
Vessel Transit Corridors: Members of the fishing community have
requested that offshore wind energy facilities be designed in a manner
that, among other things, provides for safe transit to fishing grounds
where relevant. The information currently available does not indicate
that transit corridors are warranted, but BOEM may nonetheless consider
designating portions of a lease as transit corridors. Bidders should be
aware that BOEM may include a lease stipulation in the FSN that
addresses transit corridors, pending the outcome of additional
discussions with ocean users and stakeholders as well as consideration
of comments submitted in response to this PSN.
Potential Future Restrictions to Mitigate Potential Conflicts with
Department of Defense Activities: Those interested in bidding should be
aware of potential conflicts with existing uses of the OCS by DoD. BOEM
coordinates with DoD throughout the leasing process.
i. Air Surveillance and Radar: A DoD assessment was conducted on
the Call Area by the Military Aviation and Installation Assurance
Siting Clearinghouse. The North American Aerospace Defense Command
mission may be affected by the development of the Lease Area(s).
Considering both the expected heights of offshore turbines and future
cumulative wind turbine effects, adverse impacts are potentially
mitigatable through Radar Adverse-impact Management (RAM). For projects
where RAM mitigation is acceptable, BOEM will include the following in
any sale notification and project approval conditions:
Lessee will notify NORAD 30-60 days ahead of project completion
and, again, when the project is complete and operational for RAM
scheduling;
Lessee will contribute funds to DoD of no less than $80,000 toward
the execution of the RAM for each radar system affected; and
Curtailment for national security or defense purposes as described
in the lease.
BOEM will require the lessee to enter into an agreement with the
DoD to implement these conditions and mitigate any identified impacts.
Sixth Generation Over the Horizon Radar is currently in development.
Offshore wind turbines in the Gulf of Mexico may create adverse impacts
to that system. BOEM will further coordinate with DoD and the lessee to
deconflict potential impacts throughout the project review stage.
Mitigation measures or terms and conditions of a plan approval may
result from this coordination effort.
III. Participation in the Proposed Lease Sale
a. Bidder Participation: All entities who would like to participate
in this proposed GOM lease sale must submit the required qualification
materials to BOEM by the end of the 60-day comment period for this PSN.
b. Affiliated Entities: On the Bidder's Financial Form (BFF),
discussed below, eligible bidders must list any other eligible bidders
with whom they are affiliated. For the purpose of identifying
affiliated entities, a bidding entity is any individual, firm,
corporation,
[[Page 20237]]
association, partnership, consortium, or joint venture (when
established as a separate entity) that is participating in the same
auction. BOEM considers bidding entities to be affiliated when:
i. They own or have common ownership of more than 50 percent of the
voting securities, or instruments of ownership or other forms of
ownership, of another bidding entity. Ownership of less than 10 percent
of another bidding entity constitutes a presumption of non-control that
BOEM may rebut.
ii. They own or have common ownership of 10 through 50 percent of
the voting securities or instruments of ownership, or other forms of
ownership, of another bidding entity, and BOEM determines that there is
control upon consideration of factors including the following:
a. The extent to which there are common officers or directors.
b. With respect to the voting securities, or instruments of
ownership or other forms of ownership: The percentage of ownership or
common ownership, the relative percentage of ownership or common
ownership compared to the percentage(s) of ownership by other bidding
entities, if a bidding entity is the greatest single owner, or if there
is an opposing voting bloc of greater ownership.
c. Shared ownership, operation, or day-to-day management of a
lease, grant, or facility, as those terms are defined in BOEM's
regulations at 30 CFR 585.112.
iii. They are both direct, or indirect, subsidiaries of the same
parent company.
iv. If, with respect to any lease(s) offered in this auction, they
have entered into an agreement prior to the auction regarding the
shared ownership, operation, or day-to-day management of such lease.
v. Other evidence indicates the existence of power to exercise
control, such as evidence that one bidding entity has power to exercise
control over the other, or that multiple bidders collectively have the
power to exercise control over another bidding entity or entities.
Affiliated entities are not permitted to compete against each other
in the auction. Where two or more affiliated entities have qualified to
bid in the auction, the affiliated entities must decide prior to the
auction which one (if any) will participate in the auction. If two or
more affiliated entities attempt to participate in the auction, BOEM
will disqualify those bidders from the auction.
IV. Questions For Stakeholders
Stakeholders are encouraged to comment on any matters related to
this proposed lease sale that are of interest or concern to them.
However, BOEM has identified the following issues as particularly
important, and we encourage commenters to address these issues
specifically:
a. Number, size, orientation, and location of the proposed Lease
Areas: In this PSN, BOEM proposes to offer four Lease Areas in the GOM.
BOEM is seeking feedback on the proposed number, size, orientation, and
location of the Lease Areas and welcomes comments on which Lease Areas,
if any, should be prioritized for inclusion, or exclusion, from this
lease sale.
Considerations for the delineation of a Lease Area: These
delineation considerations may include comparable commercial viability
and size; prevailing wind direction and minimal wake effects; maximized
energy generating potential; mooring system anchor footprints and
extents; possible setbacks at Lease Area boundaries; distance to shore,
port infrastructure, and electrical grid interconnections; and fair
return to the Federal Government pursuant to the Outer Continental
Shelf Lands Act through competition for commercially viable lease
areas. Additional comments are welcome regarding other considerations
for delineating Lease Areas.
Transit corridors: BOEM welcomes comments on the potential need for
including defined transit corridors within the proposed Lease Area and
the degree to which such corridors might meet potential users' needs.
Existing uses that may be affected by the development of the
proposed Lease Areas: If transit corridors are warranted, what would be
the preferred placement and orientation (length, width, etc.) that
would facilitate continuance of existing uses? BOEM asks commenters to
submit technical and scientific data in support of their comments.
Benefits to underserved communities: Executive Order 13985,
``Advancing Racial Equity and Support for Underserved Communities
Through the Federal Government'' states ``the Federal Government should
pursue a comprehensive approach to advancing equity for all, including
people of color and others who have been historically underserved,
marginalized, and adversely affected by persistent poverty and
inequality.'' Executive Order 14008, ``Tackling the Climate Crisis at
Home and Abroad'' states that in order ``to secure an equitable
economic future, the United States must ensure that environmental and
economic justice are key considerations in how we govern. That means
investing and building a clean energy economy that creates well-paying
union jobs, turning disadvantaged communities--historically
marginalized and overburdened--into healthy, thriving communities, and
undertaking robust actions to mitigate climate change while preparing
for the impacts of climate change across rural, urban, and Tribal
areas.''
Consistent with its statutory and regulatory authorities, BOEM is
considering lease stipulations to ensure that communities, particularly
underserved communities, are considered and engaged early and often
throughout the offshore wind energy development process; that potential
impacts and benefits from lessees' projects are documented; and
lessees' project proposals are informed by or altered to address those
impacts and benefits.
BOEM invites comments on the appropriate mechanisms and evaluation
metrics of these additional lease requirements. Commenters are
encouraged to describe how these, or similar measures, would further
the development of the proposed Lease Areas and the purposes of
subsection 8(p) of the Outer Continental Shelf Lands Act (OCSLA). BOEM
requests that commenters provide references to any studies that support
their recommendations.
f. Bidding Credit for Workforce Training or Supply Chain
Development: BOEM seeks comments on whether there are additional
activities that should qualify for this bidding credit or are there
other changes to the structure of the credit that will best aid in
developing a sustained and robust U.S. offshore wind workforce and/or
energy supply chain?
g. Bidding Credit for Fisheries Compensatory Mitigation Fund: BOEM
seeks comment on its proposal for a fisheries compensatory mitigation
fund and the associated bidding credit.
h. Native American Tribes, ocean users, and stakeholder engagement:
In an effort to require early and regular lessee engagement with
affected stakeholders, BOEM is proposing a lease stipulation that would
require lessees to provide a semi-annual (i.e., every 6 months)
progress report that summarizes engagement with Native American Tribes
and ocean users potentially affected by proposed activities on the
lease or proposed project easement. The progress report would identify
and describe: all existing users; the lessee's engagement with
[[Page 20238]]
those users; efforts to avoid, minimize, or mitigate any conflict
between the existing users and the lessee; disproportionate impacts to
environmental justice communities; and planned next steps to engage
those users and address identified conflicts. The lease stipulation
specifically would require coordination with the commercial fishing
industry and consideration of potential conflicts prior to proposing a
wind turbine layout in the COP. BOEM seeks comment on this concept
generally, as well as comment on the contents and timing of such
reports.
i. Coordinated engagement: BOEM seeks comments on other methods to
improve coordination and engagement among lessees, federally recognized
Tribes, and other stakeholders. Specifically, BOEM is soliciting input
on how to improve the frequency, duration, and sustainability of
collaborative engagement among these parties, as well as the preferred
form it should take (in-person, webinar, facilitated meeting, etc.).
BOEM recognizes its responsibility under Executive Order 13175 to
conduct government-to-government consultations with Tribal governments.
Coordinated engagement between federally recognized Tribes and lessees
that may be required in a future lease would be in addition to BOEM's
responsibilities. To illustrate the intent of this question, one
possible lease term to facilitate coordinated engagement could be to
require lessees to hold coordination meetings at regular intervals
throughout the year (i.e., quarterly, biannually, annually, etc.).
During these meetings, lessees would share information and updates
about their activities with federally recognized Tribes and other
stakeholders and solicit feedback and input about lessee activities.
These meetings would not substitute for government-to-government
meetings between Tribes and Federal agencies, including BOEM.
j. Prescribed layouts: BOEM seeks comment about whether BOEM should
consider prescribing uniform and aligned turbine layouts in the Lease
Area. Would the establishment of uniform turbine layouts negate the
need for established transit corridors?
k. Removal of Limits on the Number of Lease Areas per Bidder: BOEM
proposes to allow each qualified entity to bid on and potentially
acquire as many Lease Areas as are offered in the GOMW-2 sale. In the
Atlantic and Pacific OCS Regions, BOEM has often used a one-per-
customer rule so that more lessees will be competing for State clean
energy offtake procurements. However, States adjacent to the GOM Lease
Areas do not have statutory or enforceable offshore wind targets.
Rather, offshore wind energy is more likely to be sold directly to
large industrial customers or serve as the electricity source for
hydrogen. Allowing lessees to win multiple lease areas may provide for
economies of scale and more efficient development. BOEM is seeking
feedback on the proposed unlimited eligibility on, and potential
acquisition of, all four of the Lease Areas offered in the GOMW-2 sale.
l. Industry standards for environmental protection: Are there new
industry standards (e.g., new or improved technology, vessel design or
operating procedures, etc.) for environmental protection during any
phase of development that BOEM should consider?
m. Production of Hydrogen on the Lease: BOEM has made revisions to
the lease to explicitly include the production of hydrogen or other
energy products using wind turbine generators on the lease. BOEM
welcomes feedback on these changes and whether additional changes are
necessary to fully accommodate hydrogen production.
V. Proposed Lease Sale Deadlines and Milestones
This section describes the major deadlines and milestones in the
auction process from publication of this PSN to execution of a lease
issued pursuant to this sale.
a. The PSN Comment Period:
i. Submit Comments: The public is invited to submit comments during
this 60-day period, which will expire on May 20, 2024. All comments
received or postmarked during the comment period will be made available
to the public and considered by BOEM prior to publication of the FSN.
Public Auction Seminar: BOEM will host a public seminar to discuss
the lease sale process and the auction format. The time and place of
the seminar will be announced by BOEM and published on the BOEM website
at <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>. No registration or RSVP is required to attend.
Submit Qualifications Materials: For prospective bidders who want
to participate in this lease sale: All qualification materials must be
received by BOEM by May 20, 2024. This includes materials sufficient to
establish a company's legal, technical, and financial qualifications
pursuant to 30 CFR 585.107-.108. To qualify to participate in this
lease sale, qualification materials would need to be developed in
accordance with the guidelines available at <a href="https://www.boem.gov/Renewable-Energy-Qualification-Guidelines/">https://www.boem.gov/Renewable-Energy-Qualification-Guidelines/</a>.
Confidential Information: If you wish to protect the
confidentiality of your comments or qualification materials, clearly
mark the relevant sections and request that BOEM treat them as
confidential. Please label privileged or confidential information with
the caption ``Contains Confidential Information'' and consider
submitting such information as a separate attachment. Treatment of
confidential information is addressed in Section XXI entitled
``Protection of Privileged or Confidential Information.'' Information
that is not labeled as privileged or confidential would be regarded by
BOEM as suitable for public release.
b. End of PSN Comment Period to FSN Publication:
i. Review Comments: BOEM will review all comments submitted in
response to the PSN during the comment period.
Finalize Qualifications Reviews: Prior to the publication of the
FSN, BOEM will complete any outstanding reviews of bidder
qualifications materials submitted during the PSN comment period. The
final list of qualified bidders will be published in the FSN.
Prepare the FSN: BOEM will prepare the FSN by updating information
contained in the PSN where appropriate.
Publish FSN: BOEM will publish the FSN in the Federal Register at
least 30 days before the date of the sale.
c. FSN Waiting Period: During the period between FSN publication
and the lease auction (i.e., a minimum of 30 days), qualified bidders
are required to take several steps to remain eligible to participate in
the auction.
i. Bidder's Financial Form: Each bidder must submit a BFF to BOEM
to participate in the auction. The BFF must include each bidder's
conceptual strategy for each non-monetary bidding credit for which that
bidder would like to be considered. BOEM must receive each bidder's BFF
no later than the date listed in the FSN. BOEM may consider extensions
to this deadline only if BOEM determines that the failure to timely
submit a BFF was caused by events beyond the bidder's control. The
proposed BFF can be downloaded at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
Once BOEM has processed a bidder's BFF, the bidder is allowed to
log into <a href="http://pay.gov">pay.gov</a> and submit a bid deposit. For purposes of this
auction, BOEM will not
[[Page 20239]]
consider BFFs submitted by bidders for previous lease sales. An
original signed BFF may be mailed to BOEM's GOM Regional Office for
certification. A signed copy of the form may be submitted in PDF format
to <a href="/cdn-cgi/l/email-protection#2d5f4843485a4c4f41484843485f4a546d4f424840034a425b"><span class="__cf_email__" data-cfemail="2250474c475543404e47474c4750455b62404d474f0c454d54">[email protected]</span></a>. A faxed copy will not be accepted. Your
BFF submission should be accompanied with a transmittal letter on
company letterhead. The BFF must be executed by an authorized
representative listed on the bidder's legal qualifications in the BFF,
in accordance with 18 U.S.C. 1001 (fraud and false statements).
Additional information regarding the BFF may be found below in Section
IX entitled ``Bidder's Financial Form.''
Bid Deposit: Each qualified bidder must submit a bid deposit of
$2,000,000 for one (1) Lease Area. If the FSN allows bidders to bid for
and potentially win more than one Lease Area, each qualified bidder
must submit a bid deposit of $2,000,000 per Lease Area. For example, if
a qualified bidder wanted to bid on and potentially acquire four (4)
Lease Areas, the bidder would need to submit a bid deposit of
$8,000,000. Further information about bid deposits can be found below
in Section X ``Bid Deposit.''
d. Notification of Eligibility for Non-Monetary Credits: Prior to
the Mock Auction, BOEM will notify each bidder of its determination of
eligibility for bidding credits for each auction in which it is
participating.
e. Mock Auction: BOEM will hold a Mock Auction that is open only to
qualified bidders who have met the requirements and deadlines for
auction participation, including submission of the bid deposit. The
Mock Auction is intended to give bidders an opportunity to clarify
auction rules, test the functionality of the auction software, and
identify any potential issues that may arise during the auction. Final
details of the Mock Auction will be provided in the FSN.
f. The Auction: BOEM, through its contractor, will hold an auction,
as described in the FSN. The auction will take place no sooner than 30
days following the publication of the FSN in the Federal Register. The
estimated timeframes described in this PSN assume that the auction will
take place approximately 45 days after the publication of the FSN.
Final dates will be included in the FSN. BOEM will announce the
provisional winners of the lease sale after the auction ends.
g. From the Auction to Lease Execution:
i. Refund Non-Winners: Once the provisional winners have been
announced, BOEM will provide the non-winners with a written explanation
of why they did not win and return their bid deposits.
Department of Justice (DOJ) Review: DOJ will have 30 days in which
to conduct an antitrust review of the auction, pursuant to 43 U.S.C.
1337(c).
Delivery of the Lease: BOEM will send three lease copies to each
winner, with instructions on how to execute the lease. Once the lease
has been fully executed, a provisional winner becomes an auction
winner. The first year's rent is due 45-calendar days after the winners
receive the lease copies for execution.
Return the Lease: Within 10-business days of receiving the lease
copies, the auction winners must post financial assurance, pay any
outstanding balance of their winning bids (i.e., winning monetary bid
minus applicable bid deposit and value of the bidding credit, as
applicable), and sign and return the three executed lease copies. The
winners may request extensions and BOEM may grant such extensions if
BOEM determines the delay was caused by events beyond the requesting
winner's control, pursuant to 30 CFR 585.224(e).
Execution of Lease: Once BOEM has received the signed lease copies
and verified that all other required materials have been received, BOEM
will make a final determination regarding its issuance of the leases
and will execute the leases, if appropriate.
VI. Withdrawal of Blocks
BOEM reserves the right to withdraw all or portions of the Lease
Areas prior to deciding whether to execute the leases with the winning
bidders.
VII. Lease Terms and Conditions
BOEM has made available the proposed terms, conditions, and
stipulations for the commercial leases that would be offered through
this proposed sale. BOEM reserves the right to require compliance with
additional terms and conditions associated with the approval of a site
assessment plan (SAP) and COP. The proposed leases are on BOEM's
website at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>. Each lease would include the following
attachments:
a. Addendum ``A'' (``Description of Leased Area and Lease
Activities'');
b. Addendum ``B'' (``Lease Term and Financial Schedule'');
c. Addendum ``C'' (``Lease-Specific Terms, Conditions, and
Stipulations''); and
d. Addendum ``D'' (``Project Easement'');
Addenda ``A,'' ``B,'' and ``C'' provide detailed descriptions of
proposed lease terms and conditions. Addendum ``D'' will be completed
at the time of COP approval or approval with modifications. After
considering comments on the PSN and proposed lease, BOEM will publish
final lease terms and conditions in the FSN.
Proposed Lease Stipulations: BOEM proposes to add or revise the
following lease stipulations or provisions from previous commercial
leases:
i. Fisheries Communication Plan: A stipulation in the lease
entitled ``Commercial Fisheries,'' which would contain components of
stipulations in prior commercial leases issued by BOEM, including a
requirement for a Fisheries Communications Plan (FCP). BOEM is
proposing to add elements to this stipulation in response to its
extensive engagement with Tribal governments, the fishing industry, and
governmental agencies. Major proposed revisions include: (i)
identifying dock space and transit routes that would minimize space use
conflicts and potential impacts to protected species; (ii) minimizing
both congestion and the creation of obstacles that could result in an
increased risk of entanglement; and (iii) to the extent practicable,
prioritizing Federal and State climate change adaptation strategies for
fisheries.
Native American Tribes Communication Plan: A revised NATCP
requirement from the one included in previous commercial leases to
require the Lessee to work with BOEM and the Gulf of Mexico to identify
Tribes with cultural and/or historical ties to the Lease Areas and
invite those Tribes to participate in the development of the NATCP. The
NATCP would also include protocols for unanticipated discovery of any
potential pre-contact archaeological resource(s).
Protected Species: A requirement for the Lessees to coordinate with
BOEM, NMFS, and the U.S. Fish and Wildlife Service (USFWS) prior to
designing and conducting biological surveys intended to support
offshore renewable energy plans that could interact with protected
species.
Marine Mammal Protection Act Authorization(s). If the Lessee is
required to obtain an authorization pursuant to section 101(a)(5) of
the Marine Mammal Protection Act prior to conducting survey activities
in support of plan submittal, BOEM will require the Lessees to provide
to the Lessor a copy of the authorization prior to commencing these
activities.
Site Characterization: An updated requirement regarding survey
plans and
[[Page 20240]]
pre-survey meetings (subsection 2.1 of Addendum ``C'' to the proposed
lease). BOEM proposes to make the pre-survey meeting between the lessee
and BOEM optional at BOEM's discretion. BOEM also recommends removing
the requirement for lessees to meet with BOEM prior to holding Tribal
pre-survey meetings. This change would allow lessees more flexibility
in scheduling Tribal pre-survey meetings, possibly holding them earlier
and allowing greater opportunity for Tribal input.
Siting Conditions: A lease stipulation that outlines situations
when lessees may not construct surface facilities.
Research Access: A stipulation that would make explicit BOEM's
reservation of the right to access the lease area for purposes of
future research and other activities.
Project Labor Agreements and Supply Chain: Two lease stipulations
that would encourage construction efficiency for projects and
contribute towards establishing a domestic supply chain:
The first stipulation would require Lessees to make every
reasonable effort to enter into a Project Labor Agreement (PLA)
covering the construction stage of any project proposed for the Lease
Areas. The PLA provisions for the construction of an offshore wind
project would apply to all contractors.
The second stipulation would require the Lessee to establish a
statement of goals in which the Lessee would describe its plans for
contributing to the creation of a robust and resilient U.S.-based
offshore wind industry supply chain. The Lessee would be required to
provide regular progress updates on the achievement of those goals to
BOEM, and BOEM would make those updates publicly available.
BOEM includes these stipulations because it is committed to a clean
energy future, workforce development and safety, and the establishment
of a durable domestic supply chain that can sustain the U.S. offshore
wind energy industry and wants to advance this vision.
Stakeholder and Ocean User Engagement Summary: A requirement for
the lessee to include a stakeholder and ocean user engagement summary
as part of their progress reporting requirements (see subsection 3.1 of
Addendum ``C'' of the lease). This summary would include a description
of all existing users, engagement activities with those users during
the reporting period, and a description of efforts to minimize any
conflict between the existing users and the lessee.
Confirmed Munitions of Concern (MEC)/Unexploded Ordnance (UXO)
Notification: A stipulation in the lease that would require
notification for confirmed MEC/UXO. Under this stipulation, the lessee
would be required to notify BOEM, BSEE, and relevant agency
representatives when a confirmed discovery is made.
VIII. Lease Financial Terms and Conditions
This section provides an overview of the required annual payments
and financial assurances under the lease. Please see the proposed lease
for more detailed information, including any changes from past
practices.
a. Rent: Pursuant to 30 CFR 585.224(b) and 585.503, the first
year's rent payment of $3 per acre is due within 45-calendar days after
the lessee receives the lease copies from BOEM. Thereafter, annual rent
payments are due on the anniversary of the effective date of the lease
(the ``Lease Anniversary''). Once commercial operations under the lease
begin, BOEM will charge rent only for the portions of the Lease Area
remaining undeveloped (i.e., non-generating acreage). For example, for
the 102,557 acres Lease Area of (OCS-G 0XXX), the rent payment would be
$307,671 per year until commercial operations begin.
If the lessee submits an application for relinquishment of a
portion of its leased area within the first 45-calendar days after
receiving the lease copies from BOEM and BOEM approves that
application, no rent payment would be due on the relinquished portion
of the Lease Area. Later relinquishments of any portion of the lease
area would reduce the lessee's rent payments starting in the year
following BOEM's approval of the relinquishment.
The lessee also must pay rent for any project easement associated
with the lease. Rent commences on the date that BOEM approves the COP
that describes the project easement (or any modification of such COP
that affects the easement acreage), as outlined in 30 CFR 585.507. If
the COP revision results in increased easement acreage, additional rent
would be required at the time the COP revision is approved. Annual rent
for a project easement is the greater of $5 per acre per year or $450
per year.
Operating Fee: For purposes of calculating the initial annual
operating fee payment under 30 CFR 585.506, BOEM applies an operating
fee rate to a proxy for the wholesale market value of the electricity
expected to be generated from the project during its first 12 months of
operations. This initial payment will be prorated to reflect the period
between the commencement of commercial operations and the Lease
Anniversary. The initial annual operating fee payment will be due
within 90 days of the commencement of commercial operations.
Thereafter, subsequent annual operating fee payments will be due on or
before the Lease Anniversary. If offshore wind energy is used to
generate hydrogen or other energy products, the annual operating fee
for electricity will continue to be calculated as provided in the lease
as a proxy for the market value of hydrogen. Because there is currently
a limited market for commercial hydrogen, the operating fee charged on
the electricity generation will serve as a proxy for the energy
products.
The subsequent annual operating fee payments will be calculated by
multiplying the operating fee rate by the imputed wholesale market
value of the projected annual electric power production. For purposes
of this calculation, the imputed market value will be the product of
the project's annual nameplate capacity, the total number of hours in
the year (8,760), the capacity factor, and the annual average price of
electricity derived from a regional wholesale power price index. For
example, the annual operating fee for a 976 megawatt (MW) wind facility
operating at a 30 percent capacity (i.e., capacity factor of 0.3) with
a regional wholesale power price of $40 per megawatt hour (MWh) and an
operating fee rate of 0.02 would be calculated as follows:
[GRAPHIC] [TIFF OMITTED] TN21MR24.007
[[Page 20241]]
i. Operating Fee Rate: The operating fee rate is the share of the
imputed wholesale market value of the projected annual electric power
production due to ONRR as an annual operating fee. For the Lease Areas,
BOEM proposes to set the fee rate at 0.02 (2 percent) for the entire
life of commercial operations.
Nameplate Capacity: Nameplate capacity is the maximum rated
electric output, expressed in MW, which the turbines of the wind
facility under commercial operations can produce at their rated wind
speed as designated by the turbine's manufacturer.
Capacity Factor: BOEM proposes to set the capacity factor at 0.3
(i.e., 30 percent) for the year in which the commercial operations date
occurs and for the first 6 years of commercial operations on the lease.
At the end of the sixth year, BOEM may adjust the capacity factor to
reflect the performance over the previous 5 years based upon the actual
metered electricity generation at the delivery point to the electrical
grid or where the electricity is used to generate hydrogen or other
energy products. BOEM may make similar adjustments to the capacity
factor once every 5 years thereafter.
Wholesale Power Price Index: Under 30 CFR 585.506(c)(2)(i), the
wholesale power price, expressed in dollars per MWh, is determined at
the time each annual operating fee payment is due. For the leases
offered in this sale, BOEM proposes to use the ERCOT (Texas Coast
Region) average price per MW from the Enerfax power prices dataset
within Hitachi's ABB Velocity Suite. A similar price dataset can also
be used and may be posted by BOEM for reference.
Financial Assurance: Within 10-business days after receiving the
lease copies and pursuant to 30 CFR 585.515-.516, the provisional
winner would be required to provide an initial lease-specific bond or
other BOEM-approved financial assurance instrument in the amount of
$100,000. BOEM encourages the provisional winner to discuss financial
assurance requirements with BOEM as soon as possible after the auction
has concluded.
BOEM would base the amount of all SAP, COP, and decommissioning
financial assurance on cost estimates for meeting all accrued lease
obligations at the respective stages of development. The required
amount of supplemental and decommissioning financial assurance will be
determined on a case-by-case basis.
The financial terms described above can be found in Addendum ``B''
of the lease, which is available at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
IX. Bidder's Financial Form
Each bidder would be required to provide the information required
in the BFF referenced in this PSN. A copy of the proposed form is
available at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>. BOEM recommends that each bidder designate an
email address in its BFF that the bidder would then use to create an
account in <a href="http://pay.gov">pay.gov</a> (if it has not already done so). BOEM will not
consider previously submitted BFFs for previous lease sales to satisfy
the requirements of this auction. BOEM may consider BFFs submitted
after the deadline set in the FSN if BOEM determines that the failure
to timely submit the BFF was caused by events beyond the bidder's
control. The BFF is required to be executed by an authorized
representative listed in the qualification package on file with BOEM.
X. Bid Deposit
Each qualified bidder would be required to submit a bid deposit no
later than the date listed in the FSN. Typically, this deadline is
approximately 30-calendar days after the publication of the FSN. BOEM
may consider extensions to this deadline only if BOEM determines that
the failure to timely submit the bid deposit was caused by events
beyond the bidder's control.
Following the auction, bid deposits will be applied against the
winning bid and other obligations owed to BOEM. If a bid deposit
exceeds that bidder's total financial obligation, BOEM will refund the
balance of the bid deposit to the bidder. BOEM will refund bid deposits
to the unsuccessful bidders once BOEM has announced the provisional
winners.
If BOEM offers a lease to a provisional winner and that bidder
fails to timely return the signed lease, establish financial assurance,
or pay the balance of its bid, BOEM would retain the bidder's
$2,000,000 bid deposit for the Lease Area. In such a circumstance, BOEM
reserves the right to offer a lease for that Lease Area to the next
highest bidder as determined by BOEM.
XI. Minimum Bid
The minimum bid is the lowest bid amount per acre that BOEM will
accept as a winning bid, and it is the amount at which BOEM will start
the bidding in the auction. BOEM proposes a minimum bid amount of
$50.00 per acre for this lease sale.
XII. Auction Procedures
a. Multiple-Factor Bidding Auction: As authorized under 30 CFR
585.220(a)(4) and 585.221(a)(6), BOEM proposes to use a multiple-factor
auction format for this lease sale. Under BOEM's proposal, the bidding
system for this lease sale would be a multiple-factor combination of
monetary and non-monetary factors. The bid made by a particular bidder
in each round would represent the sum of the monetary factor (cash bid)
and the value of any non-monetary factors in the form of bidding
credits. BOEM proposes to start the auction using the minimum bid price
for the Lease Areas and to increase these prices incrementally until
only one bidder remains bidding on each Lease Area in the auction.
BOEM is proposing to grant bidding credits to bidders that commit
to one or both of the following:
i. Supporting workforce training programs for the offshore wind
industry or developing a domestic supply chain for the offshore wind
industry, or a combination of both; or
ii. Establishing and contributing to a fisheries compensatory
mitigation fund or contributing to an existing fund to mitigate
potential negative impacts to commercial and for-hire recreational
fisheries caused by OCS offshore wind development in the Gulf of
Mexico.
These bidding credits are intended to:
i. Enhance, through training, the offshore wind workforce and/or
enhance the establishment of a domestic supply chain for offshore wind
manufacturing, assembly, or services, both of which will contribute to
the expeditious and orderly development of offshore wind resources on
the OCS;
ii. Support the expeditious and orderly development of OCS
resources by mitigating potential direct impacts from proposed projects
and encouraging the investment in infrastructure germane to the
offshore wind industry; and
iii. Minimize potential economic effects on commercial fisheries
impacted by potential offshore wind development, as cooperation with
commercial fisheries impacted by OCS operations will enable development
of the Lease Area to advance.
Changes to Auction Rules: BOEM will be employing new auction
software for sales held in 2024. The auction format remains an
ascending clock auction with multiple-factor bidding. Five primary
changes have been made to the ascending clock auction rules in the new
software.
i. If a bidder decides to bid on a different Lease Area in a
subsequent
[[Page 20242]]
round of the auction, it may submit a bid for the Lease Area it bid on
in the previous round and, simultaneously, submit a bid for another
Lease Area. This allows a bidder the option to switch to another Lease
Area if the price of the first Lease Area exceeds the specified bid
price.
ii. Provisional winners will no longer be determined using a two-
step process. The auction rules are implemented in a way such that,
when the auction concludes, the bidder who remains on a Lease Area
after the final round becomes its provisional winner. There will be no
additional processing to determine whether any other Lease Areas can be
awarded to other bidders.
iii. The auction will use a ``second price'' rule. A given Lease
Area will be won by the bidder that submitted the highest bid amount
for the Lease Area, but the winning bidder will pay the highest bid
amount at which there was competition (i.e., the ``second price'').
iv. If the FSN allows bidders to bid for and potentially acquire
two or more Lease Areas, any bid for two or more Lease Areas will be
treated as independent bids for those Lease Areas, rather than as a
package bid.
v. Each bidder's bidding credit will be expressed directly as a
percentage of the final price for the lease.
All potential bidders should review the complete Auction Procedures
for Offshore Wind Lease Sales (Version 1) located at: <a href="https://www.boem.gov/renewable-energy/lease-and-grant-information">https://www.boem.gov/renewable-energy/lease-and-grant-information</a>.
The Auction: Using an online bidding system to host the auction,
BOEM would start the bidding for Leases OCS-G 37962 through 37965 as
described below.
----------------------------------------------------------------------------------------------------------------
Lease area name Lease area ID Acres Minimum bid
----------------------------------------------------------------------------------------------------------------
Lease I-1..................................... OCS-G 37962.......................... 102,500 $5,125,000
Lease I-2..................................... OCS-G 37963.......................... 96,786 4,839,300
Lease J-1..................................... OCS-G 37964.......................... 108,230 5,411,500
Lease K-1..................................... OCS-G 37965.......................... 102,544 5,127,200
----------------------------------------------------------------------------------------------------------------
BOEM is proposing to allow each qualified bidder to bid for and
potentially acquire as many Lease Areas as are offered in the GOMW-2
sale. The possible alternatives to the proposed unlimited eligibility
would be a specified limit on the number of Lease Areas in each region
that a bidder can bid for and potentially win, or a specified overall
limit on the number of Lease Areas in the GOMW-2 sale that a bidder can
bid for and potentially win.
The auction will be conducted in a series of rounds. Before each
round, the auction system will announce the prices for each Lease Area
offered in the auction. In Round 1, there is a single price for each
Lease Area equal to the minimum bid price (also known as the `opening
price' or `clock price of Round 1'). Each bidder can bid, at the
opening prices, for as many Lease Areas as allowed by the FSN and the
bidder's bid deposit. After Round 1, the bidder's processed demand is
one for each Lease Area for which the bidder bid in Round 1. The
bidder's eligibility for Round 2 equals the number of Lease Areas for
which the bidder bid in Round 1.
Starting in Round 2, each Lease Area is assigned a range of prices
for the round. The start-of-round price is the lowest price in the
range, and the clock price is the highest price in the range. A bidder
still eligible to bid after the previous round can either continue
bidding at the new round's clock price(s) for the same Lease Area(s)
for which the bidder's processed demand is one or submit bid(s) to
reduce demand for one (or more) Lease Area(s) at any price(s) in the
range(s) for that round. A bid to reduce demand at some price indicates
that the bidder is not willing to acquire that Lease Area at a price
exceeding the specified bid price. A bidder that bids to reduce demand
for Lease Areas can optionally bid on up to the same number of other
Lease Areas.
If an eligible bidder does not place a bid during the round for the
Lease Area for which the bidder's processed demand is one, the auction
system will consider this a request to reduce demand for that Lease
Area at the round's start-of-round price.\2\ That bidder can
nonetheless win that Lease Area if it is the last remaining bidder for
that Lease Area.
---------------------------------------------------------------------------
\2\ When the round ends and the bidder still has not placed a
bid, the system will process the bid as if the bidder is asking to
leave that lease area at any price above the start-of-round price
for that lease area that it previously bid on.
---------------------------------------------------------------------------
After each round, the auction system processes the bids and
determines each bidder's processed demand for each Lease Area and the
posted prices for the Lease Areas. The bidder's eligibility for the
next round would equal the number of Lease Areas for which the bidder
had a processed demand of one. If, after any round, a bidder's
processed demand is zero for every Lease Area, the bidder's eligibility
drops to zero and the bidder can no longer bid in the auction. The
posted price is the price determined for each Lease Area after
processing of all bids for a round. If only one bidder remains on a
Lease Area, the posted price reflects the ``second price'' (i.e., the
highest price at which there was competition for the Lease Area).\3\
---------------------------------------------------------------------------
\3\ The Auction Procedures for Offshore Wind Lease Sales
provides details on how bids are prioritized and processed.
---------------------------------------------------------------------------
The posted price for a Lease Area after each round becomes the
start-of-round price for that Lease Area in the next round.
If, after the bids for the round have been processed, there is no
Lease Area with excess demand, the auction will end. When this occurs,
each bidder with a processed demand of one for a Lease Area will become
the provisional winner for that Lease Area. Otherwise, the auction will
continue with a new round in which the start-of-round price for each
Lease Area equals the posted price of the previous round.
The increment by which the clock price exceeds the start-of-round
price will be determined based on several factors including, but not
necessarily limited to, the expected time needed to conduct the auction
and the number of rounds that have already occurred. BOEM reserves the
right to increase or decrease the increment as it deems appropriate.
The provisional winner of each Lease Area will pay the final posted
price (less any applicable bidding credit), or risk forfeiting its bid
deposit. A provisional winner will be disqualified if it is
subsequently found to have violated auction rules or BOEM regulations,
or otherwise engaged in conduct detrimental to the integrity of the
competitive auction. If a bidder submits a bid that BOEM determines to
be a provisionally winning bid, the bidder must sign the applicable
lease documents, post financial assurance, and submit the outstanding
balance (if any) of its winning bid (i.e., winning monetary bid minus
the applicable bid deposit and the value of bidding credits, as
applicable) within 10-business days of receiving the lease copies,
pursuant to 30 CFR 585.224. BOEM reserves the
[[Page 20243]]
right to not issue the lease to the provisionally winning bidder if
that bidder fails to: timely execute three copies of the lease and
return them to BOEM, timely post adequate financial assurance, timely
pay the balance of its winning bid, or otherwise comply with applicable
regulations or the terms of the FSN. In any of these cases, the bidder
will forfeit its bid deposit and BOEM reserves the right to offer a
lease to the next highest eligible bidder as determined by BOEM.
BOEM will publish the names of the provisional winners of the Lease
Areas and the associated prices shortly after the conclusion of the
sale. Full bid results, including round-by-round results of the entire
sale, will be published on BOEM's website after a review of the results
and announcement of the provisional winner.
Additional Information Regarding the Auction Format:
i. Authorized Individuals and Bidder Authentication: An entity that
is eligible to participate in the auction will identify on its BFF up
to three individuals who will be authorized to bid on behalf of the
company, including their names, business telephone numbers, and email
addresses. All individuals will log into the auction system using
<a href="http://login.gov">login.gov</a>. Prior to the auction, all the individuals listed on the BFF
form must obtain a Fast Identify Online (FIDO) compliant security
key,\4\ and must register this security key on <a href="http://login.gov">login.gov</a> using the same
email address that was listed in the BFF. The <a href="http://login.gov">login.gov</a> registration,
together with the FIDO-compliant security key, will enable the
individual to log into the auction website. BOEM will provide
information on this process on its website.
---------------------------------------------------------------------------
\4\ FIDO-keys are produced by many manufacturers, such as Yubico
and Google. They are widely available and can easily be purchased
from Amazon, Best Buy, Walmart, or any other seller of electronics.
The latest generation of the FIDO standard is FIDO2, and you should
obtain the key compliant with the FIDO2 authentication standard.
Depending on the computer you use, you might need to obtain an
adapter as FIDO-keys require a USB port.
---------------------------------------------------------------------------
After BOEM has processed the bid deposits, the auction contractor
will send an email to the authorized individuals, inviting them to
practice logging into the auction website on a specific day in advance
of the mock auction. The <a href="http://login.gov">login.gov</a> login process, along with the
authentication process for the auction helpdesk, will also be tested
during the mock auction. If an eligible bidder fails to submit a bid
deposit or does not participate in the first round of the auction, BOEM
will deactivate that bidder's login information.
ii. Timing of Auction: The FSN will provide specific information
regarding when bidders can enter the auction system and when the
auction will start.
iii. Messaging Service: BOEM and the auction contractors will use
the auction platform messaging service to keep bidders informed on
issues of interest during the auction. For example, BOEM could change
the schedule at any time, including during the auction. If BOEM changes
the schedule during an auction, it will use the messaging feature to
notify bidders that a revision has been made and will direct bidders to
the relevant page. BOEM will also use the messaging system for other
updates during the auction.
iv. Bidding Rounds: Bidders are allowed to place bids or to change
their bids at any time during the bidding round. At the top of the
bidding page, a countdown clock shows how much time remains in each
round. Bidders will have until the end of the round to place bids.
Bidders should do so according to the procedures described in the FSN
and the Auction Procedures for Offshore Wind Lease Sales. Information
about the round results will be made available only after the round has
closed, so there is no strategic advantage to placing bids early or
late in the round. The Auction Procedures for Offshore Wind Lease Sales
elaborate on the auction procedures described in this PSN. In the event
of any inconsistency between the Auction Procedures for Offshore Wind
Lease Sales, the Bidder Manual, and the FSN, the FSN is controlling.
Alternate Bidding Procedures: Redundancy is the most effective way
to mitigate technical and human issues during an auction. BOEM strongly
recommends that bidders consider authorizing more than one individual
to bid in the auction--and confirming during the mock auction that each
individual is able to access the auction system. A mobile hotspot or
other form of wireless access is helpful in case a company's main
internet connection should fail. As a last resort, an authorized
individual facing technical issues may request to submit its bid by
telephone. In order to be authorized to place a telephone bid, an
authorized individual must call the help desk number listed in the
auction manual before the end of the round. BOEM will authenticate the
caller's identity, including requiring the caller to provide a code
from the software token. The caller must also explain the reasons why a
telephone bid needs to be submitted. BOEM may, in its sole discretion,
permit or refuse to accept a request for the placement of a bid using
this alternate telephonic bidding procedure. The auction help desk
requires codes from the Google Authenticator application (app) as part
of its procedure for identifying individuals who call for assistance.
Prior to the auction, all individuals listed on the BFF should download
the Google Authenticator\TM\ mobile app \5\ onto their smartphone or
tablet.\6\ The first time the individual logs into the auction system,
the system will provide a QR token to be read into the Google
Authenticator app. This token is unique to the individual and enables
the Google Authenticator app to generate time-sensitive codes that will
be recognized by the auction system. When an individual calls the
auction help desk, the current code from the app must be provided to
the help desk representative as part of the user authentication
process. BOEM will provide information on this process on its website.
---------------------------------------------------------------------------
\5\ Google Authenticator must be installed from either the Apple
App Store or the Google Play Store.
\6\ Installing the app is only required if the Google
Authenticator is not already installed on the smartphone or tablet.
---------------------------------------------------------------------------
17.0 Percent Bidding Credit for Workforce Training or Supply Chain
Development or a Combination of Both: This proposed bidding credit
would allow a bidder to receive a credit of 17.0 percent of the final
posted price of the Lease Area in exchange for a commitment to make a
qualifying monetary contribution (``Contribution''), in the same amount
as the bidding credit received, to programs or initiatives that support
workforce training programs for the U.S. offshore wind industry or
development of a U.S. domestic supply chain for the offshore wind
industry, or both, as described in the BFF Addendum and the lease. To
qualify for this credit, the bidder must commit to the bidding credit
requirements on the BFF and submit a conceptual strategy as described
in the BFF Addendum.
i. As proposed, the Contribution to workforce training must result
in a better trained and/or larger domestic offshore wind workforce that
would provide for more efficient operations via increasing the supply
of fully trained personnel. Training of existing lessee employees,
lessee contractors, or employees of affiliated entities would not
qualify.
ii. The Contribution to domestic supply chain development must
result in overall benefits to the U.S. offshore wind supply chain
available to all potential purchasers of offshore wind
[[Page 20244]]
services, components, or subassemblies, not solely the lessee's
project; and either (i) the demonstrable development of new domestic
capacity (including vessels) or the demonstrable buildout of existing
capacity, or (ii) an improved offshore wind domestic supply chain by
reducing the upfront capital or certification cost for manufacturing
offshore wind components, including the building of facilities, the
purchasing of capital equipment, and the certifying of existing
manufacturing facilities.
iii. Contributions cannot be used to satisfy private cost shares
for any Federal tax or other incentive programs where cost sharing is a
requirement. No portion of the Contribution may be used to meet the
requirements of any other bidding credits for which the lessee
qualifies.
iv. Bidders interested in obtaining a bidding credit could choose
to contribute to workforce training programs, domestic supply chain
initiatives, or a combination of both. The Conceptual Strategy must
describe verifiable actions that the lessee will take that would allow
BOEM to confirm compliance when the documentation for satisfying the
bidding credit is submitted. The Contribution must be tendered in full,
and the lessee must provide documentation evidencing it has made the
Contribution and complied with applicable requirements, no later than
the date the lessee submits its first Facility Design Report (FDR).
v. As proposed, Contributions to workforce training would need to
promote and support one or more of the following purposes: (i) Union
apprenticeships, labor management training partnerships, stipends for
workforce training, or other technical training programs or
institutions focused on providing skills necessary for the planning,
design, construction, operation, maintenance, or decommissioning of
offshore wind energy projects in the United States; (ii) Maritime
training necessary for the crewing of vessels to be used for the
construction, servicing, and/or decommissioning of wind energy projects
in the United States; (iii) Training workers in skills or techniques
necessary to manufacture or assemble offshore wind components,
subcomponents or subassemblies. Examples of areas involving these
skills and techniques include welding; wind energy technology;
hydraulic maintenance; braking systems; mechanical systems, including
blade inspection and maintenance; or computers and programmable logic
control systems; (iv) Tribal offshore wind workforce development
programs or training for employees of an Indian Economic Enterprise in
skills necessary in the offshore wind industry; or (v) Training in any
other job skills that the lessee can demonstrate are necessary for the
planning, design, construction, operation, maintenance, or
decommissioning of offshore wind energy projects in the United States.
vi. As proposed, Contributions to domestic supply chain development
must promote and support one or more of the following: (i) Development
of a domestic supply chain for the offshore wind industry, including
manufacturing of components and sub-assemblies and the expansion of
related services; (ii) Domestic Tier 2 and Tier 3 offshore wind
component suppliers and domestic Tier 1 supply chain efforts, including
quay-side fabrication; \7\ (iii) Technical assistance grants to help
U.S. manufacturers re-tool or certify (e.g., ISO-9001) for offshore
wind manufacturing; (iv) Development of Jones Act-compliant vessels for
the construction, servicing, and/or decommissioning of wind energy
projects in the United States; (v) Purchase and installation of lift
cranes or other equipment capable of lifting or moving foundations,
towers, and nacelles quayside, or lift cranes on vessels with these
capabilities; (vi) Port infrastructure directly related to offshore
wind component manufacturing or assembly of major offshore wind
facility components; (vii) Establishing a new or existing bonding
support reserve or revolving fund available to all businesses providing
goods and services to offshore wind energy companies, including
disadvantaged businesses and/or Indian Economic Enterprises; or (viii)
Other supply chain development efforts that the lessee can demonstrate
advance the manufacturing of offshore wind components or subassemblies
or the provision of offshore wind services, in the United States.
---------------------------------------------------------------------------
\7\ Tier 1 denotes the primary offshore wind components such as
the blades, nacelles, towers, foundations, and cables. Tier 2
subassemblies are the systems that have a specific function for a
Tier 1 component. Tier 3 subcomponents are commonly available items
that are combined into Tier 2 subassemblies, such as motors, bolts,
and gears.
---------------------------------------------------------------------------
vii. Documentation: If a lease is issued pursuant to a winning bid
that includes a bidding credit for workforce training or supply chain
development, the lessee would be required to provide documentation
showing that the lessee has met the financial commitment before the
lessee submits the first FDR for the lease. The documentation must
allow BOEM to objectively verify the amount of the Contribution and the
beneficiary(ies) of the Contribution.
At a minimum, the documentation would need to include: all written
agreements between the lessee and beneficiary(ies) of the Contribution,
which must detail the amount of the Contribution(s) and how it will be
used by the beneficiaries of the Contribution(s) to satisfy the goals
of the bidding credit for which the Contribution was made; all receipts
documenting the amount, date, financial institution, and the account
and owner of the account to which the Contribution was made; and sworn
statements by the entity that made the Contribution and the
beneficiary(ies) of the Contribution attesting that all information
provided in the above documentation is true and accurate. The
documentation would need to describe how the funded initiative or
program has advanced, or is expected to advance, U.S. offshore wind
workforce training or supply chain development. The documentation must
also provide qualitative and/or quantitative information that includes
the estimated number of trainees or jobs supported, or the estimated
leveraged supply chain investment resulting or expected to result from
the Contribution. The documentation would need to contain any
information called for in the Conceptual Strategy that the lessee
submitted with its BFF and to allow BOEM to objectively verify (i) the
amount of the Contribution and the beneficiary(ies) of the
Contribution, and (ii) compliance with the bidding credit criteria
provided in Addendum ``C'' of the lease. If the lessee's implementation
of its Conceptual Strategy changes due to market needs or other
factors, the lessee would need to explain the changed approach. BOEM
would reserve all rights to determine that the bidding credit has not
been satisfied if changes from the lessee's Conceptual Strategy result
in the lessee not meeting the criteria for the bidding credit described
in Addendum ``C'' of the lease.
viii. Enforcement: The commitment for the bidding credit would be
made in the BFF and would be included in a lease addendum that would
bind the lessee and all future assignees of the lease. If BOEM were to
determine that a lessee or assignee had failed to satisfy the
requirements of the bidding credit, or if a lessee were to relinquish
or otherwise fail to develop the lease by the tenth anniversary date of
lease issuance, the amount corresponding to the bidding credit awarded
would be immediately due and payable to the Office of Natural Resources
Revenue
[[Page 20245]]
(ONRR) with interest from the lease Effective Date. The interest rate
would be the underpayment interest rate identified by ONRR. The lessee
would not be required to pay said amount if the lessee satisfied its
bidding credit requirements but failed to develop the lease by the
tenth Lease Anniversary. BOEM could, at its sole discretion, extend the
documentation deadline beyond the first FDR submission or extend the
lease development deadline beyond the 10-year timeframe.
8.0 Percent Bidding Credit for Fisheries Compensatory Mitigation
Fund: The second bidding credit proposed would allow a bidder to
receive a credit of 8.0 percent of the final posted price of the Lease
Area in exchange for a commitment to establish and contribute to a
fisheries compensatory mitigation fund, or to contribute to a similar
existing fund, to compensate for potential negative impacts to
commercial and for-hire recreational fisheries. The term ``commercial
fisheries'' refers to commercial and processing businesses engaged in
the act of catching and marketing fish and shellfish for sale from the
Gulf of Mexico. The term ``for-hire recreational fisheries'' refers to
charter and head-boat fishing operations involving vessels-for-hire
engaged in recreational fishing in the Gulf of Mexico that are hired
for a charter fee by an individual or group of individuals for the
exclusive use of that individual or group of individuals. Lessees are
encouraged to contribute to a regional fund which would provide
financial compensation for economic loss from offshore wind development
in the Gulf of Mexico. At a minimum, the compensation must address the
following:
Gear loss or damage; and
Lost fishing income in Gulf of Mexico wind energy Lease Areas.
The fisheries compensatory mitigation fund would assist commercial
and for-hire recreational fisheries directly impacted by income or gear
losses due to offshore wind activities on offshore wind leases or
easements and is intended to address the impacts identified in BOEM's
environmental and project reviews. The compensatory mitigation would be
required to cover impacts that result directly from the
preconstruction, construction, operations and decommissioning of an
offshore wind project being developed on Gulf of Mexico wind energy
leases or easements. The fund would be required to be established, and
the Contribution made before the lessee submits the lease's first FDR
or before the fifth Lease Anniversary, whichever is sooner. To qualify
for this credit, the bidder would be required to commit to the bidding
credit requirements on the BFF and submit a conceptual strategy as
described in the BFF Addendum.
(1) Bidders committing to use the fisheries compensatory mitigation
fund bidding credit must submit their Conceptual Strategy along with
their BFF, further described below and in the BFF Addendum. The
Conceptual Strategy would describe the actions that the lessee intends
to take that would allow BOEM to verify compliance when the lessee
seeks to demonstrate satisfaction of the requirements for the bidding
credit. The lessee would be required to provide documentation showing
that the lessee has met the commitment and complied with the applicable
bidding credit requirements before the lessee submits the lease's first
FDR or before the fifth Lease Anniversary, whichever is sooner.
(2) As proposed, gear loss, damage, and fishing income loss claims
should be prioritized at each phase of offshore wind project
development, including impacts from surveys conducted before the
establishment of the fund. BOEM encourages lessees to coordinate with
other lessees to establish or contribute to a regional fund. A regional
fund should be flexible enough to incorporate future contributions from
future lease auctions and actuarially sound enough to recognize the
multi-decade life of offshore wind projects in the Gulf of Mexico.
While the fund's first priority is to compensate for gear loss or
damage and income loss, funds that have been determined to be excess
based on an actuarial accounting may be used to:
a. Promote participation of fishers and fishing communities in the
project development process or other programs that better enable the
fishing and offshore wind industries to co-exist;
b. Offset the cost of gear upgrades and transitions for operating
within a wind facility.
Any fund established or selected by the lessee to meet this bidding
credit requirement would be required to include a process for
evaluating the actuarial status of funds at least every 5 years and
publicly reporting information on fund disbursement and administrative
costs at least annually.
(3) The fisheries compensatory mitigation fund would be required to
be independently managed by a third party and designed with fiduciary
governance and strong internal controls while minimizing administrative
expenses. The Contribution may be used for fund startup costs, but the
Fund should minimize costs by leveraging existing processes,
procedures, and information from BOEM Fisheries Mitigation Guidance,
the Eleven Atlantic States' Fisheries Mitigation Project, or other
sources.
(4) Documentation: As proposed, if a lease is awarded pursuant to a
winning bid that includes a fisheries compensatory mitigation fund
bidding credit, the lessee would be required to provide written
documentation to BOEM that demonstrates that it completed the fund
Contribution before it submits the lease's first FDR or before the
fifth Lease Anniversary, whichever is sooner. The documentation would
be required to enable BOEM to objectively verify the Contribution has
met all applicable requirements as outlined in Addendum ``C'' of the
lease. At a minimum, this documentation would be required to include:
a. the procedures established to compensate for gear loss or damage
resulting from all phases of the project development on the Lease Area
(pre-construction, construction, operation, and decommissioning);
b. the fisheries compensatory mitigation fund charter, including
the governance structure, audit and public reporting procedures, and
standards for paying compensatory mitigation for impacts to fishers
from development on wind energy Lease Areas in the Gulf of Mexico;
c. all receipts documenting the amount, date, financial
institution, and the account and owner of the account to which the
Contribution was made; and
d. sworn statements by the entity that made the Contribution,
attesting to:
i. the amount and date(s) of the Contribution;
ii. that the Contribution is being (or will be) used in accordance
with the bidding credit requirements in the lease; and
iii. that all information provided is true and accurate.
The documentation would be required to contain any information
specified in the Conceptual Strategy that was submitted with the BFF.
If the lessee's implementation of its Conceptual Strategy changes due
to market needs or other factors, the lessee would need to explain this
change. BOEM reserves the right to determine that the bidding credit
has not been satisfied if changes from the lessee's Conceptual Strategy
result in the lessee not meeting the criteria for the bidding credit
described in Addendum ``C'' of the lease.
(5) Enforcement: The commitment to the fisheries compensatory
mitigation fund bidding credit will be made in the BFF. It will be
included in Addendum ``C'' of the lease and will bind the lessee
[[Page 20246]]
and all future assignees of the lease. If BOEM were to determine that a
lessee or assignee had failed to satisfy the commitment at the time the
first FDR is submitted, or by the fifth Lease Anniversary, whichever is
sooner, the amount corresponding to the bidding credit awarded would be
immediately due and payable to ONRR with interest from the lease
effective date. The interest rate would be the underpayment interest
rate identified by ONRR. The lessee would not be required to pay said
amount if the lessee satisfied its bidding credit requirements by the
time the first FDR is submitted, or the fifth Lease Anniversary,
whichever is sooner. BOEM may, at its sole discretion, extend the
documentation deadline beyond the first FDR or beyond the 5-year
timeframe.
XIII. Rejection or Non-Acceptance of Bids
BOEM reserves the right and authority to reject any and all bids
that do not satisfy the requirements and rules of the auction, the FSN,
or applicable regulations and statutes.
XIV. Anti-Competitive Review
Bidding behavior in this sale is subject to Federal antitrust laws.
Following the auction, but before the acceptance of bids and the
issuance of the lease, BOEM must ``allow the Attorney General, in
consultation with the Federal Trade Commission, thirty days to review
the results of [the] lease sale.'' 43 U.S.C. 1337(c)(1). If a
provisional winner is found to have engaged in anti-competitive
behavior in connection with this lease sale, BOEM may reject its
provisionally winning bid. Compliance with BOEM's auction procedures
and regulations is not an absolute defense against violations of
antitrust laws.
Anti-competitive behavior determinations are fact specific.
However, such behavior may manifest itself in several different ways,
including, but not limited to:
1. An express or tacit agreement among bidders not to bid in an
auction, or to bid a particular price;
2. An agreement among bidders not to bid against each other; or
3. Other agreements among bidders that have the potential to affect
the final auction price.
Pursuant to 43 U.S.C. 1337(c)(3), BOEM may decline to award a lease
if the Attorney General, in consultation with the Federal Trade
Commission, determines that awarding the lease may be inconsistent with
antitrust laws.
For more information on whether specific communications or
agreements could constitute a violation of Federal antitrust law,
please see <a href="https://www.justice.gov/atr/business-resources">https://www.justice.gov/atr/business-resources</a> and consult
legal counsel.
XV. Process for Issuing the Lease
Once all post-auction reviews have been completed to BOEM's
satisfaction, BOEM will issue three unsigned copies of the lease to the
provisional winner. Within 10-business days after receiving the lease
copies, the provisional winner must:
1. Execute and return the lease copies on the bidder's behalf;
2. File financial assurance, as required under 30 CFR 585.515-537;
and
3. Pay by electronic funds transfer (EFT) the balance (if any) of
the winning bid (winning monetary bid minus the applicable bid
deposit). BOEM would require bidders to use EFT procedures (not
<a href="http://pay.gov">pay.gov</a>, the website bidders used to submit bid deposits) for payment
of the balance of the winning bid, following the detailed instructions
contained in the ``Instructions for Making Electronic Payments''
available on BOEM's website at: <a href="https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/EFT-Payment-Instructions.pdf">https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/EFT-Payment-Instructions.pdf</a>.
BOEM will not execute the lease until the three requirements above
have been satisfied. BOEM may extend the 10-business-day deadline if
BOEM determines the delay was caused by events beyond the provisional
winner's control.
If the provisional winner does not meet these requirements or
otherwise fails to comply with applicable regulations or the terms of
the FSN, BOEM reserves the right not to issue the lease to that bidder.
In such a case, the provisional winner would forfeit its bid deposit.
Also, in such a case, BOEM reserves the right to offer the lease to the
next highest eligible bidder as determined by BOEM.
Within 45-calendar days after receiving the lease copies, the
provisional winner must pay the first year's rent using the ``ONRR
Renewable Energy Initial Rental Payments'' form available at: <a href="https://www.pay.gov/public/form/start/27797604/">https://www.pay.gov/public/form/start/27797604/</a>.
Subsequent annual rent payments must be made following the detailed
instructions contained in the ``Instructions for Making Electronic
Payments,'' available on BOEM's website at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>.
XVI. Non-Procurement Debarment and Suspension Regulations
Pursuant to 43 CFR part 42, subpart C, an OCS renewable energy
lessee must comply with the Department of the Interior's non-
procurement debarment and suspension regulations at 2 CFR parts 180 and
1400. The lessee must also communicate this requirement to persons with
whom the lessee does business relating to this lease by including this
term as a condition in their contracts and other transactions.
XVII. Final Sale Notice
The development of the FSN will be informed through the EA, related
consultations, and comments received during the PSN comment period. The
FSN will provide the final details concerning the offering and issuance
of an OCS commercial wind energy lease in the Lease Area in the GOM.
The FSN will be published in the Federal Register at least 30 days
before the lease sale is conducted and will provide the date and time
of the auction.
XVIII. Changes to Auction Details
BOEM has the discretion to change any auction detail specified in
the FSN, including the date and time, if events outside BOEM's control
have been found to interfere with a fair and proper lease sale. Such
events may include, but are not limited to, natural disasters (e.g.,
earthquakes, hurricanes, floods, and blizzards), wars, riots, act of
terrorism, fire, strikes, civil disorder, Federal Government shutdowns,
cyberattacks against relevant information systems, or other events of a
similar nature. In case of such events, BOEM would notify all qualified
bidders via email, phone, and BOEM's website at: <a href="https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities">https://www.boem.gov/renewable-energy/state-activities/gulf-mexico-activities</a>. Bidders
should call BOEM's Auction Manager at 703-787-1121 if they have
concerns.
XIX. Appeals
The appeals and reconsideration procedures are provided in BOEM's
regulations at 30 CFR 585.225 and 585.118(c). BOEM's decision on a bid
is the final action of the Department, except that an unsuccessful
bidder may apply for reconsideration by the Director under 30 CFR
585.225 as follows:
If BOEM rejects your bid, BOEM will provide a written statement of
the reasons and will refund any money deposited with your bid, without
interest.
You may ask the BOEM Director for reconsideration, in writing,
within 15-business days of bid rejection, under 30 CFR 585.118(c)(1).
The Director will
[[Page 20247]]
send you a written response either affirming or reversing the
rejection.
XX. Public Participation
BOEM does not consider anonymous comments; please include your name
and address as part of your comment. You should be aware that your
entire comment, including your name, address, and any other personally
identifiable information (PII) included in your comment, may be made
publicly available at any time. In order for BOEM to consider
withholding your PII from disclosure, you must identify, in a cover
letter, any information contained in your comments that, if released,
would constitute a clearly unwarranted invasion of your personal
privacy. You must also briefly describe any possible harmful
consequences of the disclosure, such as embarrassment, injury, or other
harm.
Even if BOEM withholds your information in the context of this PSN,
your submission is subject to the Freedom of Information Act (FOIA). If
your comment is requested under FOIA, your information will only be
withheld if a determination is made that one of the FOIA's exemptions
to disclosure applies. Such a determination will be made in accordance
with the Department's FOIA regulations and applicable law.
Note that BOEM will make available for public inspection all
comments, except for identified privileged or confidential information,
submitted by organizations and businesses, or by individuals
identifying themselves as representatives of organizations or
businesses.
XXI. Protection of Privileged or Confidential Information
BOEM will protect privileged or confidential information that you
submit consistent with the Freedom of Information Act (FOIA) and 30 CFR
585.114. Exemption 4 of FOIA applies to ``trade secrets and commercial
or financial information obtained from a person'' that is privileged or
confidential. 5 U.S.C. 552(b)(4).
If you wish to protect the confidentiality of your comments or
qualification information, clearly mark the relevant sections
``Contains Privileged or Confidential Information'' and request that
BOEM treat the information as confidential. You should consider
submitting such information as a separate attachment. BOEM will not
disclose such information, except as required by FOIA. Information that
is not labeled as privileged or confidential may be regarded by BOEM as
suitable for public release. Further, BOEM will not treat as
confidential aggregate summaries of otherwise non-confidential
information.
a. Access to Information (54 U.S.C. 307103): BOEM is required,
after consultation with the Secretary of the Interior, to withhold the
location, character, or ownership of historic resources if the
Secretary and the agency determine that disclosure may, among other
things, cause a significant invasion of privacy, risk harm to the
historic resources, or impede the use of a traditional religious site
by practitioners. Tribal entities and other interested parties should
designate information that they would like to be held as confidential
and provide the reasons why BOEM should do so.
Authority: 43 U.S.C. 1337(p); 30 CFR 585.211 and 585.216.
Elizabeth Klein,
Director, Bureau of Ocean Energy Management.
[FR Doc. 2024-05955 Filed 3-20-24; 8:45 am]
BILLING CODE 4340-98-P
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</html>Indexed from Federal Register on March 21, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.