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Wind farm auction for ocean zone continues after record bid

An aerial view of the Deepwater Windfarm, located

An aerial view of the Deepwater Windfarm, located 2 miles south of Block Island, RI and 12 miles east off the coast of Montauk Point, as seen on November 23, 2016. Credit: Kevin P. Coughlin / AllislandAerial

Bidding will resume Friday morning on the lease rights to build an offshore wind farm on 79,350 acres of ocean more than 11 miles from Jones Beach after three participants came in at what is believed to be a record-setting price Thursday evening.

The latest bid of $25.469 million was the result of an online auction that started Thursday with six participants willing to pay $158,700, or around $2 per acre. The price climbed throughout the day before the federal Bureau of Ocean Energy Management, a division of the Department of the Interior running the auction, called it a night after 27 rounds at 6:30 p.m.

The price shatters previous records for a U.S. offshore wind lease, according to trade publication The previous highest amount was $8.7 million paid in 2014 to develop two ocean zones off Maryland, the publication said.

Bureau spokeswoman Tracey Moriarty said the identities of the bidders won’t be revealed until the bid is awarded.

Fourteen parties, including the New York State Energy Research and Development Authority, had been deemed eligible to participate in the bidding. Moriarty has said this auction marks the first time a government entity would bid against private developers in the six auctions for Atlantic Coast wind-energy areas.

In addition to NYSERDA, potential bidders for the New York wind area included Deepwater Wind, the company that has proposed a 90-megawatt wind farm for LIPA in federal waters off Rhode Island, DONG Energy Wind Power, Fisherman’s Energy, Sea Breeze Energy, Statoil Wind and Convalt Energy, Newsday has reported.

The auction had a special condition that allowed the winning bidder to withdraw if the second-highest bidder is a government authority.

A NYSERDA spokeswoman didn’t respond to requests for comment Thursday.

Fishing groups, including the largest commercial fishing association on Long Island, had filed suit earlier this month seeking to block the project, alleging the 194 turbines would hinder access to vital fishing grounds.

The head of the Long Island Commercial Fishing Association said she was concerned about the high price for the land.

“If you pay such a high price for a property, clearly you expect a return on investment,” said executive director Bonnie Brady. “It makes me very fearful that they’d be willing to remove vital fishing grounds from that large of an area.”

Six bidders agreed to the asking price set by the Bureau of Ocean Management through 21 rounds, as the price reached $14.46 million. The number of bidders dropped to four, and then to three.

— With Mark Harrington

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