Bud's Offshore Energy (BOE)

After 20 rounds yesterday, the sale resumes today.

The biggest difference between the wind and the oil and gas programs may be the way the sales are conducted. For oil and gas leases, you submit a single sealed bid. Here is a simplified description of how a wind lease sale is conducted:

• At the start of each round, BOEM will state an asking price for each Lease Area. A bid at the full asking price is referred to as a “live bid.”
• If the bidder has qualified for a non-monetary credit, it will meet the asking price by submitting a multiple-factor bid—that is, a live bid that consists of a monetary (cash) element and a non-monetary credit.
• To participate in the next round of the auction, a bidder is required to have submitted a live bid for one of the Lease Areas (or have a carried-forward bid) in each previous round.
• As long as there are two or more live bids (including carried-forward bids) for at least one of the Lease Areas, the auction moves to the next round
• If there was only one live bid (including carried-forward bids) or no live bids for a Lease Area in the previous round, the asking price would not be increased.
• A live bid would automatically be carried forward if it was uncontested in the previous round, and the bidder who placed the uncontested bid would not be permitted to place any other bid in the current round of the auction.
• Conversely, if a live bid was contested in the previous round, the bidder who placed the contested bid would be free to bid on any Lease Area in the auction in the next round, at the new asking price.
• If a bidder decides to stop bidding before the final round of the auction, there are circumstances in which the bidder could nonetheless win a lease.
• Between rounds, BOEM will disclose to all bidders that submitted bids: (1) the number of live bids (including carried-forward bids) for each Lease Area in the previous round of the auction.
• In any round after the first round, a bidder may submit an “exit bid” only for the same Lease Area as the bidder’s contested live bid in the previous round. An exit bid is a bid that is greater than the previous round’s asking price, but less than the current round’s asking price.
• The auction ends (finally) when a round occurs in which each of the Lease Areas in the auction receives one or zero live bids (including carried-forward bids), regardless of the number of exit bids on any Lease Area.

Perfectly clear? You can read the full description in the Sale Notice.

Is this the best way to award offshore wind leases?