By Aaron Applegate
September 4, 2013
The real estate is cheap. The bidding will start at $2 an acre.
The online auction to lease nearly 113,000 acres of federal waters for a wind-power farm about 24 miles off the coast of Virginia Beach is today. Eight companies, including Dominion Virginia Power, have qualified to participate.
"We'll keep going until we've identified a single bidder," said Tracey Moriarty, a spokeswoman for the Bureau of Ocean Energy Management, the federal agency running the auction.
Bidding will start at $225,000. The winner will have five years to come up with a plan to build and finance a wind farm off Virginia. Actual construction, if it happens, would likely be after 2020.
The Virginia auction will be the nation's second. In July, a New England company bid $3.8 million for the rights to develop a wind farm on 165,000 acres off the coasts of Massachusetts and Rhode Island. The winning $23-per-acre price was reached in the 11th round of bidding.
There are no offshore wind farms operating in the United States. Developing the industry has been a priority of the Obama administration.
Gov. Bob McDonnell and Virginia Beach city officials back a Virginia wind farm and want Hampton Roads to become an industry hub for building and installing wind turbines.
In addition to bidding in the auction, Dominion is leading a group known as the Virginia Offshore Wind Technology Advancement Project. The team wants to build two demonstration turbines off Virginia Beach. The group is hoping to be selected by the Department of Energy for construction funding next year.
Demonstration turbines and those that might be built in the lease area would not be visible from land, officials have said.
The test project's main goal is to learn how to build turbines economically. Dominion officials estimate that the cost of wind energy would be three times hi