U.S. Oil & Gas Association President Tim Stewart recently discussed the Biden administration’s proposal for the fewest offshore drilling leases in history during an interview on ‘FOX & Friends First’. The plan, which aims to hold a historically-low number of offshore oil and gas lease sales, may indirectly impact the administration’s offshore wind energy goals. This is due to a key provision in the 2022 Inflation Reduction Act (IRA), which prohibits the Department of the Interior (DOI) from issuing an offshore wind development lease unless a certain amount of offshore oil and gas leasing has been offered in the previous 12 months.
Erik Milito, the president of the National Ocean Industries Association (NOIA), expressed concern about the potential impact of the plan on offshore wind lease sales. He emphasized that gaps in lease sales would limit opportunities for companies to bring forward projects and hinder the administration’s goal of expanding offshore wind power. The Biden administration’s long-awaited oil leasing proposal, released in September, included a record-low three offshore lease sales, deviating from previous plans issued by both Democratic and Republican administrations.
The provision in the IRA creates three one-year periods in 2025, 2027, and 2029, during which the federal government would be prohibited from holding wind lease sales. This could disrupt the administration’s ambitious plan to deploy 30 gigawatts of offshore wind energy by 2030. To achieve this goal, the DOI will likely need to lease additional acres in various regions across the United States.
While a few offshore wind farms are currently operational, many large-scale projects along the East Coast are in different stages of development and permitting. However, even if all proposed projects were completed by 2030, the administration would still fall short of its 30-gigawatt goal. Rising costs and potential cancelations pose additional challenges to the development of offshore wind energy.
Senator Joe Manchin, Chairman of the Senate Energy and Natural Resources Committee, highlighted the importance of oil and gas lease sales in the administration’s wind and solar leasing. He acknowledged that the new five-year leasing program falls short but emphasized that it would not have been possible without the IRA. Interior Secretary Deb Haaland defended the plan, stating that it supports the growing offshore wind industry.
Erik Milito of NOIA raised concerns about the administration’s decision to prioritize shutting down domestic oil and gas production. He noted that while the administration aims to end drilling, energy demand continues to rise, highlighting the need for alternative sources of energy.
The Biden administration has not responded to requests for comment on the matter.
Overall, the Biden administration’s proposal for limited offshore drilling leases raises concerns about the impact on offshore wind energy goals. The provision in the IRA could disrupt the administration’s plans to expand offshore wind power and may hinder the achievement of its ambitious renewable energy targets. The debate over balancing oil and gas production with green energy development continues amidst the administration’s efforts to transition towards a more sustainable future.
