Federal Register / Vol. 78, No. 243 / Wednesday, December 18, 2013 / Notices 76643 

Sixth Principal Meridian 

T. 53 N., R. 98 W., 

Lots 38A to 38H, inclusive, and lots 39A 

to 39H, inclusive; 

Sec. 34, lots 1 to 4, inclusive and E1⁄2. 

The areas described aggregate 1,106.76 

acres in Park County. 

Dated: December 3, 2013. 

Rhea S. Suh, 

Assistant Secretary—Policy, Management 

and Budget. 

[FR Doc. 2013–30085 Filed 12–17–13; 8:45 am] 

BILLING CODE 4310–MN–P 

DEPARTMENT OF THE INTERIOR 

Bureau of Ocean Energy Management 

[Docket No. BOEM–2013–0002; 

MMAA104000] 

Atlantic Wind Lease Sale 3 (ATLW3) 

Commercial Leasing for Wind Power 

on the Outer Continental Shelf 

Offshore Maryland—Proposed Sale 

Notice 

AGENCY: Bureau of Ocean Energy 

Management (BOEM), Interior. 

ACTION: Proposed Sale Notice for 

Commercial Leasing for Wind Power on 

the Outer Continental Shelf Offshore 

Maryland. 

SUMMARY: This document is the 

Proposed Sale Notice (PSN) for the sale 

of commercial wind energy leases on 

the Outer Continental Shelf (OCS) 

offshore Maryland, pursuant to BOEM’s 

regulations at 30 CFR 585.216. BOEM 

proposes to offer for sale two leases, 

Lease OCS–A 0489 and Lease OCS–A 

0490. BOEM will use a multiple-factor 

auction for the lease sale. In this PSN, 

you will find information pertaining to 

the areas available for leasing, proposed 

lease provisions and conditions, auction 

details, the lease form, criteria for 

evaluating competing bids, award 

procedures, appeal procedures, and 

lease execution. BOEM invites 

comments during a 60-day comment 

period following publication of this 

notice. The issuance of the proposed 

leases resulting from this sale would not 

constitute an approval of projectspecific plans to develop offshore wind 

energy. Such plans, expected to be 

submitted by successful lessees, will be 

subject to subsequent environmental 

and public review prior to a decision to 

proceed with development. 

DATES: Comments should be submitted 

electronically or postmarked no later 

than February 18, 2014. 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). 

All bidders interested in participating 

in the lease sale who have not 

previously been qualified by BOEM to 

participate in this lease sale must 

submit the required qualification 

materials by the end of the 60-day 

comment period for this notice. All 

qualification materials must be 

postmarked no later than February 18, 

2014. 

ADDRESSES: Potential auction 

participants, Federal, state, and local 

government agencies, tribal 

governments, and other interested 

parties are requested to submit their 

written comments on the PSN in one of 

the following ways: 

1. Electronically: http://

www.regulations.gov. In the entry 

entitled, ‘‘Enter Keyword or ID,’’ enter 

BOEM–2013–0002 then click ‘‘search.’’ 

Follow the instructions to submit public 

comments. 

2. Written Comments: In written form, 

delivered by hand or by mail, enclosed 

in an envelope labeled ‘‘Comments on 

Maryland PSN’’ to: Office of Renewable 

Energy Programs, Bureau of Ocean 

Energy Management, 381 Elden Street, 

HM 1328, Herndon, Virginia 20170. 

3. Qualifications Materials: Those 

submitting qualifications materials 

should contact Erin C. Trager, BOEM 

Office of Renewable Energy Programs, 

381 Elden Street, HM 1328, Herndon, 

Virginia 20170, (703) 787–1320, or 

erin.trager@boem.gov. 

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 

the section of this PSN entitled 

‘‘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: Erin 

C. Trager, BOEM Office of Renewable 

Energy Programs, 381 Elden Street, HM 

1328, Herndon, Virginia 20170, (703) 

787–1320 or erin.trager@boem.gov. 

Authority: This PSN is published pursuant 

to subsection 8(p) of the OCS Lands Act (43 

U.S.C. 1337(p)) (‘‘the Act’’), as amended by 

section 388 of the Energy Policy Act of 2005 

(EPAct), and the implementing regulations at 

30 CFR part 585, including 30 CFR 585.211 

and 30 CFR 585.216. 

Background: The area described for 

leasing in this PSN is the same as the 

area described in the Maryland Call for 

Information and Nominations (Call) (77 

FR 5552, Feb. 3, 2012). Detailed 

information regarding the lease areas is 

provided in the section entitled, ‘‘Areas 

Offered for Leasing.’’ 

On February 3, 2012, BOEM 

published the Notice of Availability 

(NOA) (77 FR 5560) for the final 

Environmental Assessment (EA) and 

Finding of No Significant Impact 

(FONSI) for commercial wind lease 

issuance and site assessment activities 

on the Atlantic OCS offshore New 

Jersey, Delaware, Maryland, and 

Virginia, pursuant to the National 

Environmental Policy Act. 

Consultations ran concurrently with the 

preparation of the EA and included 

consultation under the Endangered 

Species Act (ESA), the MagnusonStevens Fishery Conservation and 

Management Act (MSFCMA), section 

106 of the National Historic 

Preservation Act (NHPA), and the 

Coastal Zone Management Act (CZMA). 

The Commercial Wind Lease Issuance 

and Site Assessment Activities on the 

Atlantic Outer Continental Shelf 

Offshore New Jersey, Delaware, 

Maryland, and Virginia Final 

Environmental Assessment (MidAtlantic EA) can be found at: http://

www.boem.gov/Renewable-EnergyProgram/Smart-from-the-Start/

Index.aspx. 

On May 29, 2012, BOEM initiated 

consultation with the National Marine 

Fisheries Service under the ESA for 

geological and geophysical (G&G) 

activities in support of oil and gas 

exploration and development, 

renewable energy, and marine minerals 

in the Mid- and South Atlantic Planning 

Areas. Formal consultation concluded 

with receipt of a Biological Opinion 

dated July 19, 2013. The Biological 

Opinion, along with the previous 

informal consultation, informed the 

development of this proposed sale of 

commercial wind leases offshore 

Maryland. 

Additional environmental reviews 

will be prepared upon receipt of a 

Lessee’s proposed project-specific plans, 

such as a Site Assessment Plan (SAP) or 

Construction and Operations Plan 

(COP). 

Atlantic Grid Holdings LLC (ROW) 

Grant Request: On March 31, 2011, 

Atlantic Grid Holdings LLC submitted 

an unsolicited application for a Right-ofWay grant on the OCS. Potential bidders 

should be aware that the unsolicited 

application is under consideration by 

BOEM, and that a portion of the project 


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76644 Federal Register / Vol. 78, No. 243 / Wednesday, December 18, 2013 / Notices 

is proposed to be situated within the 

Maryland Wind Energy Area (WEA). 

Following publication of a notice for a 

60-day comment period to determine 

interest in the grant, BOEM published 

its determination of no competitive 

interest (77 FR 28620, May 5, 2012). The 

nomination and associated notices can 

be found at: http://www.boem.gov/

Renewable-Energy-Program/StateActivities/Regional-Proposals.aspx. 

Deadlines and Milestones For 

Bidders: This section describes the 

major deadlines and milestones in the 

auction process from publication of this 

PSN to execution of leases pursuant to 

the sale. These are organized into 

various stages: (1) The PSN comment 

period; (2) from the end of PSN 

comment period to publication of the 

FSN; (3) the FSN waiting period; (4) 

conducting the Auction; and (5) from 

the Auction Stage to Lease Execution. 

1. The PSN Comment Period: 

• Submit Comments: The public is 

invited to submit comments during this 

60-day period. 

• Public Seminar: BOEM will host a 

public seminar to discuss the lease sale 

process and the auction format. 

• Receive Qualifications Materials: 

All qualifications materials must be 

received by BOEM by the end of the 60- 

day PSN comment period. This includes 

materials sufficient to establish a 

company’s legal, technical and financial 

qualifications. 

• Select and Invite Panelists: BOEM 

will appoint a panel of three BOEM 

employees for the purposes of reviewing 

the non-monetary packages and 

verifying the results of the lease sale. 

2. End of PSN Comment Period to 

FSN Publication 

• Review Comments: BOEM will 

review all comments submitted in 

response to the PSN during the 

comment period. 

• Finalize Qualifications Reviews: 

BOEM will complete any outstanding 

qualifications reviews using materials 

that were submitted during the PSN 

comment period and requested by 

BOEM prior to the FSN. The final list 

of eligible bidders will be published in 

the FSN. 

• Prepare the FSN: BOEM will 

prepare the FSN by updating the PSN 

where appropriate. 

• Brief and Update the BOEM 

Maryland Intergovernmental Task 

Force: BOEM will schedule a meeting or 

webinar of the BOEM Maryland 

Intergovernmental Task Force to discuss 

the FSN. 

3. FSN Waiting Period 

• Publish FSN: BOEM will publish 

the FSN in the Federal Register. 

• Bidder’s Financial Form (BFF): 

Within 14 days of publication of the 

FSN in the Federal Register, eligible 

bidders must submit a complete and 

signed BFF to BOEM. Once this 

information has been processed by 

BOEM, bidders may log into pay.gov 

and leave bid deposits. If BOEM does 

not receive the BFF by the date 

mentioned in the Federal Register, a 

company may be disqualified from 

participating in the auction. 

• Bid Deposits: Within 30 days of 

publication of the FSN in the Federal 

Register, bidders must submit a bid 

deposit meeting the requirements listed 

in the FSN. Any bidder that fails to 

submit the bid deposit by the deadline 

included in the FSN may be disqualified 

from participating in the auction. 

• Non-Monetary Package: Within 30 

days of publication of the FSN in the 

Federal Register, bidders seeking a nonmonetary credit must submit a nonmonetary package meeting the 

requirements listed in the FSN. 

• Mock Auction: BOEM will hold a 

Mock Auction open to qualified sale 

bidders only. The Mock Auction will 

take place approximately one week 

before the lease sale. Final details of the 

Mock Auction will be provided in the 

FSN. 

4. Conducting the Auction: BOEM, 

through its contractor, will hold an 

auction as described in this notice. The 

auction will take place no sooner than 

30 days following publication of the 

FSN in the Federal Register. The 

estimated timeframes described in this 

notice assume an auction date 

approximately 45 days after publication 

of the FSN. 

• Convene Panel: The panel will 

convene to consider non-monetary 

packages submitted by qualified 

bidders. The panel will send 

determinations of credit eligibility to 

BOEM, and BOEM will inform eligible 

bidders. Bidders will not be informed of 

the non-monetary credit eligibility of 

other bidders before the auction. 

• Monetary Auction: The monetary 

auction will be conducted on the date 

specified in the FSN. 

• Announce Provisional Winners: 

BOEM will announce the provisional 

winners of the lease sale after the 

auction ends. 

• Reconvene the Panel: The panel 

will reconvene to verify auction results. 

5. From Auction to Lease Execution 

• Refund Non-Winners: BOEM will 

return the bid deposit of any bidder that 

did not win a lease in the lease sale. 

BOEM will provide a written 

explanation of why the bidder did not 

win. 

• Department of Justice (DOJ) Review: 

BOEM will allow DOJ 30 days in which 

to conduct an antitrust review of the 

auction, pursuant to 43 U.S.C. 1337(c), 

which reads, in relevant part: 

Antitrust review of lease sales. 

Following each notice of a proposed 

lease sale and before the acceptance of 

bids and the issuance of leases based on 

such bids, the Secretary [of the Interior] 

shall allow the Attorney General, in 

consultation with the Federal Trade 

Commission, 30 days to review the 

results of such lease sale, except that the 

Attorney General, after consultation 

with the Federal Trade Commission, 

may agree to a shorter review period. 

• Delivery of Leases: BOEM will send 

three lease copies to each winner, with 

instructions on how to execute the 

leases. The first 6-months of the first 

year’s rent payment is due 45 days after 

the winner receives the lease copies for 

execution. 

• Return the Leases: The auction 

winners will have 10 business days 

from receiving the lease copies in which 

to file financial assurance, pay any 

outstanding balance of their bonus bids, 

and return the three executed lease 

copies. 

• Execution of Leases: Once BOEM 

has received the signed lease copies and 

verified that all required materials have 

been received, BOEM will make a final 

determination regarding its execution of 

the leases and will execute the leases if 

appropriate. 

Financial Terms and Conditions: This 

section provides an overview of the 

basic annual payments required of a 

Lessee that will be fully described in 

each lease. 

Rent 

The first year’s rent payment of $3 per 

acre for the entire lease area will be 

separated into two 6-month payments. 

The first 6-month payment is due 

within 45 days of the date the Lessee 

receives the lease for execution. The 

second 6-month payment is due by the 

first day of the seventh month after the 

Effective Date of the lease. Thereafter, 

annual rent payments are due on the 

anniversary of the Effective Date of the 

lease, i.e., the Lease Anniversary. Once 

the first commercial operations under 

the lease begin, rent will be charged on 

the remaining part of the lease not 

authorized for commercial operations, 

i.e., not generating electricity. However, 

instead of geographically dividing the 

lease area into acreage that is 

‘‘generating’’ and acreage that is ‘‘nongenerating,’’ the fraction of the lease 

accruing rent is based on the fraction of 

the total nameplate capacity of the 

project that is not yet in operation. The 


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Federal Register / Vol. 78, No. 243 / Wednesday, December 18, 2013 / Notices 76645 

fraction is the nameplate capacity (as 

defined herein) at the time payment is 

due, which is not yet authorized for 

commercial operations, divided by the 

maximum nameplate capacity after full 

installation of the project, as defined in 

the COP. This fraction is then 

multiplied by the amount of rent that 

would be due for the Lessee’s entire 

leased area at the rental rate of $3 per 

acre to obtain the annual rent due for a 

given year. 

For example, for a lease the size of 

79,707 acres (the size of the entire 

Maryland WEA), the amount of rent 

payment will be $239,121 per year if no 

portion of the leased area is authorized 

for commercial operations. If 500 

megawatts (MW) of a project’s 

nameplate capacity is operating (or 

authorized for operation), and its most 

recent approved COP specifies a 

maximum nameplate capacity of 1000 

MW, the rent payment would be 

$119,560.50. 

The Lessee also must pay rent for any 

project easement associated with the 

lease commencing on the date that 

BOEM approves the COP (or COP 

modification) that describes the project 

easement. Annual rent for a project 

easement 200-feet wide and centered on 

the transmission cable is $70.00 per 

statute mile. For any additional acreage 

required, the Lessee must also pay the 

greater of $5.00 per acre per year or 

$450.00 per year. 

Operating Fee 

The annual operating fee reflects a 2% 

operating fee rate applied to a proxy for 

the wholesale market value of electricity 

production. The initial payment is 

prorated to reflect the period between 

the start of commercial operations and 

the Lease Anniversary and is due within 

45 days of the start of commercial 

operations; thereafter, subsequent 

annual operating fee payments are due 

on or before each Lease Anniversary. 

The annual operating fee payment is 

calculated by multiplying an operating 

fee rate by the imputed wholesale 

market value of the projected annual 

electric power production. For the 

purposes of this calculation, the 

imputed market value is the product of 

the project’s annual nameplate capacity, 

the total number of hours in the year 

(8,760), a capacity utilization factor, and 

the annual average price of electricity 

derived from a historical regional 

wholesale power price index. 

Operating Fee Rate: The operating fee 

rate is set at 0.02 (i.e., 2%) during 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. The 

nameplate capacity at the start of each 

year of commercial operations on the 

lease will be specified in the COP. For 

example, if a Lessee has 20 turbines 

under commercial operations rated by 

the design manufacturer at 5 MW of 

output each, the nameplate capacity of 

the wind facility at the rated wind speed 

of the turbines would be 100 MW. 

Capacity Factor: Capacity factor 

represents the share of anticipated 

generation of the wind facility that is 

delivered to the interconnection grid 

(i.e., where the Lessee’s facility 

interconnects with the electric grid) 

relative to the wind facility’s generation 

at continuous full power operation at 

nameplate capacity, expressed as a 

decimal between zero and one. The 

capacity factor for the year in which the 

Commercial Operation Date occurs and 

for the first six full years of commercial 

operations on the lease is set to 0.4 (i.e., 

40%) to allow for one year of 

installation and testing followed by five 

years at full availability. At the end of 

the sixth year, the capacity factor may 

be adjusted to reflect the performance 

over the previous five years based upon 

the actual metered electricity generation 

at the delivery point to the electrical 

grid. Similar adjustments to the capacity 

factor may be made once every five 

years thereafter. The maximum change 

in the capacity factor from one period to 

the next will be limited to plus or minus 

10 percent of the previous period’s 

value. 

Wholesale Power Price Index: The 

wholesale power price, expressed in 

dollars per MW-hour, is determined at 

the time each annual operating fee 

payment is due, based on the weighted 

average of the inflation-adjusted peak 

and off-peak spot price indices for the 

Northeast—PJM West power market for 

the most recent year of data available as 

reported by the Federal Energy 

Regulatory Commission (FERC) as part 

of its annual State of the Markets Report 

with specific reference to the summary 

entitled, ‘‘Electric Market Overview: 

Regional Spot Prices.’’ The wholesale 

power price is adjusted for inflation 

from the year associated with the 

published spot price indices to the year 

in which the operating fee is to be due 

based on the Lease Anniversary using 

annual implicit price deflators as 

reported by the U.S. Department of 

Commerce, Bureau of Economic 

Analysis. 

Financial Assurance 

Within 10 business days after 

receiving the lease copies, the 

provisional winner must provide an 

initial lease-specific bond or other 

approved means of meeting the Lessor’s 

initial financial assurance requirements, 

in the amount of $100,000. BOEM will 

base the amount of all SAP, COP, and 

decommissioning financial assurance 

requirements on estimates of cost to 

meet all accrued lease obligations. The 

amount of supplemental and 

decommissioning financial assurance 

requirements will be determined on a 

case-by-case basis. 

The financial terms can be found in 

Addendum ‘‘B’’ of the proposed leases, 

which BOEM has made available with 

this notice on its Web site at: http://

boem.gov/Renewable-Energy-Program/

State-Activities/Maryland.aspx. 

Place And Time: The auction will be 

held online. The time that the auction 

will be held will be published in the 

FSN. The date has not been finalized, 

but will be no earlier than 30 days after 

publication of the FSN in the Federal 

Register. 

Public Seminar: BOEM will host a 

public seminar to introduce potential 

bidders and other stakeholders to the 

auction format provided in the PSN, 

explain the auction rules, and 

demonstrate the auction process. The 

time and place of the seminar will be 

announced by BOEM and published on 

the BOEM Web site. No registration or 

RSVP will be required to attend. 

Mock Auction: BOEM will host a 

Mock Auction to educate qualified 

bidders about the procedures to be 

employed during the auction and to 

answer questions. The Mock Auction 

will take place between the publication 

of the FSN in the Federal Register and 

the date of the auction. Following 

publication of the FSN in the Federal 

Register, details of the Mock Auction 

will be distributed to those eligible to 

participate in the auction. All qualified 

bidders that intend to participate in the 

auction are strongly encouraged to 

participate in the Mock Auction. 

Bidders will be eligible to participate in 

the Mock Auction if they have been 

legally, technically and financially 

qualified to participate in the lease sale, 

and have submitted an adequate bid 

deposit as discussed herein. 

Bid Deposit: A bid deposit is an 

advance cash deposit submitted to 

BOEM in order to participate in the 

auction. No later than the deadline 

provided in the FSN, each bidder must 

have submitted a bid deposit of 

$450,000 per unit of desired initial 

eligibility. Each lease is worth one unit 


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76646 Federal Register / Vol. 78, No. 243 / Wednesday, December 18, 2013 / Notices 

of bid eligibility in the auction. The 

required bid deposit for any participant 

intending to bid on both leases in the 

first round of the auction will be 

$900,000. Any participant intending to 

bid on only one of the leases during the 

auction must submit a bid deposit of 

$450,000. Any bidder that fails to 

submit the bid deposit by the deadline 

described in the FSN may be 

disqualified from participating in the 

auction. Bid deposits will be accepted 

online via pay.gov. Following 

publication of the FSN, each bidder 

must fill out the BFF included in the 

FSN. BOEM has made a copy of the 

proposed BFF available with this notice 

on its Web site at: http://boem.gov/

Renewable-Energy-Program/StateActivities/Maryland. This form requests 

that each bidder designate an email 

address, which the bidder should use to 

create an account in pay.gov. After 

establishing the pay.gov account, 

bidders may use the Bid Deposit Form 

on the pay.gov Web site to leave a 

deposit. 

Following the auction, bid deposits 

will be applied against any bonus bids 

or other obligations owed to BOEM. If 

the bid deposit exceeds the bidder’s 

total financial obligation, the balance of 

the bid deposit will be refunded to the 

bidder. BOEM will refund bid deposits 

to unsuccessful bidders. 

Minimum Bid: In this auction, 

approximately 32,737 acres will be 

offered for sale as Lease OCS–A 0489, 

and approximately 46,970 acres will be 

offered for sale as Lease OCS–A 0490. 

BOEM proposes for this lease sale a 

minimum bid of $2 per acre for each 

lease area. Therefore, the minimum 

acceptable bid will be $65,474 for Lease 

OCS–A 0489, and $93,940 for Lease 

OCS–A 0490. 

Area Offered For Leasing: The area 

described for leasing in this PSN is the 

same as the area included in the 

Maryland Call (77 FR 5552, Feb. 3, 

2012). The area proposed to be available 

for sale will be auctioned as two leases, 

Lease OCS–A 0489 [North Lease Area 

(North LA)] and Lease OCS–A 0490 

[South Lease Area (South LA)]. The 

North LA consists of 32,737 acres and 

the South LA consists of 46,970 acres. 

The total area is approximately 79,707 

acres. If there are adequate bids, two 

leases will be issued pursuant to this 

lease sale. A description of the lease 

areas can be found in Addendum ‘‘A’’ 

of the proposed leases, which BOEM 

has made available with this notice on 

its Web site at: http://boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. 

Map of the Area Offered for Leasing 

A map of the North and South LAs 

and a table of the boundary coordinates 

in X, Y (eastings, northings) UTM Zone 

18, NAD83 Datum and geographic X, Y 

(longitude, latitude), NAD83 Datum can 

be found at the following URL: http:// 

boem.gov/Renewable-Energy-Program/

State-Activities/Maryland.aspx. 

A large scale map of these areas 

showing boundaries of the area with 

numbered blocks is available from 

BOEM at the following address: Bureau 

of Ocean Energy Management, Office of 

Renewable Energy Programs, 381 Elden 

Street, HM 1328, Herndon, Virginia 

20170, Phone: (703) 787–1320, Fax: 

(703) 787–1708. 

Delineation of the Leasing Areas 

BOEM commissioned the Department 

of Energy’s National Renewable Energy 

Laboratory (NREL) to conduct an 

analysis to inform BOEM’s 

identification and delineation of leasing 

areas within the Maryland WEA prior to 

identifying areas to propose for leasing 

in the PSN. NREL’s final report for the 

Maryland WEA, ‘‘Assessment of 

Offshore Wind Energy Leasing Areas for 

the BOEM Maryland Wind Energy 

Area,’’ was released on June 26, 2013, 

and is available on BOEM’s Web site at: 

http://boem.gov/Renewable-EnergyProgram/State-Activities/

Maryland.aspx. 

BOEM delineated the WEA so that the 

South LA is slightly larger than the 

North LA, utilizing the results of the 

NREL report to inform the identification 

of these LAs. This delineation serves 

two purposes. First, it helps to offset 

technological challenges to 

development caused by deeper waters 

in the southeastern portion of the South 

LA, an issue emphasized in NREL’s 

final report. Second, it helps to offset 

certain restrictions to development in 

the South LA that BOEM may impose in 

the future, if necessary, to alleviate 

navigational safety concerns. BOEM 

believes it would be preferable to give 

each lessee equal footing to help prevent 

one lessee from being unduly burdened 

by any future development restrictions, 

which are known to be more likely in 

the South LA. 

Potential Future Restrictions To Ensure 

Navigational Safety 

Potential bidders should note that 

portions of certain sub-blocks in both 

the North and South LAs may not be 

available for future development (i.e., 

installation of wind facilities) due to 

navigational safety concerns, as 

discussed below. 

Proximity to Delaware Bay Traffic 

Separation Scheme 

During discussions with the Maryland 

Intergovernmental Task Force on June 

24, 2011, the U.S. Coast Guard (USCG) 

recommended that BOEM not approve 

the installation of wind facilities within 

1 nautical mile of a TSS to help ensure 

navigational safety. This 

recommendation was reiterated at 

subsequent Task Force meetings. 

Moreover, the USCG has expressed that 

they may determine in the future that a 

larger setback is necessary under certain 

circumstances. Tables 1 and 2 list 

potentially affected blocks and assume a 

1 nautical mile setback from an 

extended Delaware Bay TSS. Maps 

identifying these sub-blocks are 

available on BOEM’s Web site at: 

http://boem.gov/Renewable-EnergyProgram/State-Activities/

Maryland.aspx. 

TABLE 1—NORTH LEASING AREA: BLOCKS WITH POTENTIAL RESTRICTIONS

Protraction name Protraction No. Block No. Sub Block 

Salisbury ............................................................................................................................. NJ18–05 6624 D,H 

Salisbury ............................................................................................................................. NJ18–05 6625 E,I,N 

Salisbury ............................................................................................................................. NJ18–05 6675 B,C,G,H,L,P 

Salisbury ............................................................................................................................. NJ18–05 6676 M 

Salisbury ............................................................................................................................. NJ18–05 6726 A,B,F 

TABLE 2—SOUTH LEASING AREA: BLOCKS WITH POTENTIAL RESTRICTIONS

Protraction name Protraction No. Block No. Sub Block 

Salisbury ............................................................................................................................. NJ18–05 6726 J,K,O,P 


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TABLE 2—SOUTH LEASING AREA: BLOCKS WITH POTENTIAL RESTRICTIONS—Continued 

Protraction name Protraction No. Block No. Sub Block 

Salisbury ............................................................................................................................. NJ18–05 6776 D,H 

Salisbury ............................................................................................................................. NJ18–05 6777 E,I,J,N 

Salisbury ............................................................................................................................. NJ18–05 6827 C,G,H,L 

Salisbury ............................................................................................................................. NJ18–05 6828 M 

Traditional Tug, Towing, and Barge 

Traffic Route 

On April 22, 2013, BOEM received a 

letter from the USCG providing analysis 

of tug, towing, and barge traffic that 

currently transits through the MD WEA. 

The letter discussed potential safety 

implications of allowing offshore wind 

development in the area, particularly in 

the southeastern corner of the WEA, and 

requested that BOEM consider 

including two smaller LA configurations 

in this PSN. This letter can be found on 

BOEM’s Web site at: http://boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. 

BOEM gathered input regarding the 

area to include in this PSN from the 

members of BOEM’s Maryland 

Intergovernmental Task Force during a 

Task Force webinar held on June 27, 

2013, and received additional comments 

and correspondence from relevant 

stakeholders since that time. This 

includes correspondence received on 

August 29, 2013, from the American 

Waterways Operators (AWO), an 

organization representing the U.S. 

tugboat, towboat, and barge industry. In 

its August letter, AWO expressed 

concern with the Maryland WEA and its 

potential to disrupt traditional transit 

routes through the southeastern corner 

of the WEA. AWO stated that if full 

build-out were to occur in the Maryland 

WEA, this development could cause 

tugboats to navigate further east or west 

from their current north-south routes, 

which, in certain weather conditions, 

could put these vessels at greater risk 

and jeopardize safe transit due to 

different sea state conditions farther 

offshore and greater congestion closer 

inshore. This letter can be found on 

BOEM’s Web site at: http://boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. 

In a letter to BOEM dated September 

4, 2013, the Business Network for 

Maryland Offshore Wind requested that 

BOEM refrain from making any 

reductions to the Maryland WEA prior 

to leasing. They provide responses to 

the points in USCG’s April 22, 2013, 

letter and suggest that reducing the area 

now prior to receipt of a COP and an 

associated navigational risk assessment 

would be premature. The letter suggests 

that any reduction of the area due to 

potential navigational safety risk and 

any associated costs of rerouting traffic 

would be best addressed during review 

of each lessee’s COP in the context of a 

comprehensive Environmental Impact 

Statement (EIS). 

After considering the issues raised by 

the USCG and other relevant parties and 

evaluating all information available to 

date pertaining to tug, towing, and barge 

traffic through the Maryland WEA, 

BOEM has decided not to reduce the 

size of the MD WEA in this PSN. BOEM 

will receive additional vessel traffic data 

and analysis in the future, which will 

better inform a decision regarding sitespecific restrictions or mitigations to 

alleviate navigational concerns. 

Additional information that BOEM 

expects to have available to inform its 

decision would include the final 

navigational safety risk assessment that 

will be submitted with each lessee’s 

COP, and the results of two ongoing 

studies: 1) the U.S. Coast Guard’s 

Atlantic Coast Port Access Route Study 

(ACPARS), and 2) a BOEM-funded 

study, ‘‘Marine Vessel Traffic and Wind 

Energy Development Infrastructure on 

the OCS—Risk Analysis,’’ being 

conducted by the Department of 

Energy’s Pacific Northwest National 

Laboratory (PNNL). 

BOEM welcomes comments on 

navigational safety during this notice’s 

comment period and will consider all 

comments received prior to publishing 

a Final Sale Notice and holding a sale. 

Withdrawal of Blocks: BOEM reserves 

the right to withdraw areas from this 

lease sale prior to its execution of a 

lease. 

Lease Terms and Conditions: BOEM 

has included proposed lease terms, 

conditions and stipulations for OCS 

commercial wind leases in the 

Maryland WEA in Addendum ‘‘C’’ of 

the proposed leases. BOEM reserves the 

right to add additional terms and 

conditions to any approval or approval 

with modifications of a SAP and/or 

COP. The proposed leases, including 

Addendum ‘‘C’’, are available on 

BOEM’s Web site at: http://boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. Each 

proposed lease includes the following 

six attachments: 

• Addendum ‘‘A’’ (Description of 

Leased Area and Lease Activities); 

• Addendum ‘‘B’’ (Lease Term and 

Financial Schedule); 

• Addendum ‘‘C’’ (Lease Specific 

Terms, Conditions, and Stipulations); 

• Addendum ‘‘D’’ (Project Easement); 

• Addendum ‘‘E’’ (Rent Schedule); 

• Appendix A to Addendum ‘‘C’’: 

(Incident Report: Protected Species 

Injury or Mortality). 

• Appendix B to Addendum ‘‘C’’: 

(Required Data Elements for Protected 

Species Observer Reports). 

Addenda ‘‘A’’, ‘‘B’’, and ‘‘C’’ provide 

detailed descriptions of lease terms and 

conditions. Addenda ‘‘D’’ and ‘‘E’’ will 

be completed at the time of COP 

approval. 

After considering comments on the 

PSN and these proposed provisions, 

BOEM will publish final lease terms and 

conditions in the FSN. 

Plans 

Pursuant to 30 CFR 585.601, the 

leaseholder must submit a SAP within 

6 months of lease issuance. If the 

leaseholder intends to continue its 

commercial lease with an operations 

term, the leaseholder must submit a 

COP at least 6 months before the end of 

the site assessment term. 

Qualifications—Who May Bid: Any 

potential bidder that has not already 

submitted a complete set of 

qualifications materials must do so by 

the end of the 60-day comment period 

of this PSN. To be eligible to participate 

in the auction, each potential bidder 

must have been found by BOEM to be 

legally, technically and financially 

qualified under BOEM’s regulations at 

30 CFR 585.106–107 by the time the 

FSN for this sale is published. Please 

note that technical and financial 

qualifications are lease-specific; it is not 

sufficient to have been technically and 

financially qualified to pursue a project 

offshore another state. 

Guidance and examples of the 

appropriate documentation 

demonstrating the required legal 

qualifications can be found in Chapter 

2 and Appendix B of Guidelines for the 

Minerals Management Service 

Renewable Energy Framework, available 

on BOEM’s Web site at: http://

www.boem.gov/Renewable-EnergyVerDate Mar<15>2010 15:27 Dec 17, 2013 Jkt 232001 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 E:\FR\FM\18DEN1.SGM 18DEN1

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Program/Regulatory-Information/

Index.aspx. Guidance regarding how 

bidders may demonstrate their technical 

and financial qualifications is provided 

in Qualification Guidelines to Acquire 

and Hold Renewable Energy Leases and 

Grants and Alternate Use Grants on the 

U.S. Outer Continental Shelf, available 

on BOEM’s Web site at: http://

boem.gov/Renewable-Energy-Program/

Regulatory-Information/

QualificationGuidelines-pdf.aspx. 

BOEM strongly recommends that 

bidders refer to this guidance before 

submitting their qualification materials, 

as the guidance is updated periodically. 

Bidders must submit documentation 

necessary to demonstrate their legal, 

technical, and financial qualifications to 

BOEM in both paper and electronic 

formats. BOEM considers an Adobe PDF 

file stored on a compact disc (CD) to be 

an acceptable format for submitting an 

electronic copy. In their qualification 

materials, bidders must provide a 

general description of the project that 

they would like to construct on the lease 

area sought in this sale, including 

estimates of the project area and total 

nameplate capacity of the proposed 

facilities. 

Please note that it may take a number 

of weeks for bidders to establish their 

legal, technical, and financial 

qualifications. BOEM advises potential 

bidders planning to participate in a sale 

to establish their qualifications 

promptly. It is not uncommon for BOEM 

to request additional materials 

establishing qualifications following an 

initial review of the qualifications 

package. Any potential bidder whose 

qualification package is incomplete at 

the time the FSN for this sale is 

published in the Federal Register will 

be found to have failed to establish its 

qualifications and will be unable to 

participate in the sale. 

Finally, potentially interested parties 

should note that BOEM has the 

discretion to contract one or both LAs 

based upon comments received in 

response to this notice and other 

relevant information provided to the 

bureau. If a potential bidder is 

interested in leasing either or both LAs, 

whether full or partial, then that party 

should submit their qualifications 

package during the comment period of 

this PSN. 

Auction Procedures 

Summary 

For the sale of Lease OCS–A 0489 and 

Lease OCS–A 0490, BOEM will use a 

multiple-factor auction format with a 

multiple-factor bidding system. Under 

this system, BOEM may consider a 

combination of monetary and 

nonmonetary factors, or ‘‘variables,’’ in 

determining the outcome of the auction. 

BOEM will appoint a panel of three 

BOEM employees for the purposes of 

reviewing the non-monetary packages 

and verifying the results of the lease 

sale. BOEM reserves the right to change 

the composition of this panel prior to 

the date of the lease sale. The panel will 

determine whether any bidder has 

earned a non-monetary credit to be used 

during the auction (i.e., if a bidder holds 

a Power Purchase Agreement (PPA) or a 

Maryland Public Service Commission 

(PSC)-issued Offshore Renewable 

Energy Certificate (OREC) Order, as 

defined herein), and if one or more 

bidders have earned such a credit, the 

percentage that the credit will be worth. 

The auction will balance consideration 

of two variables: (1) a cash bid, and (2) 

a non-monetary credit. In sum, these 

two variables comprise the multi-factor 

bid or ‘‘As-Bid’’ auction price. A 

bidder’s As-Bid price, which is the sum 

of its cash bid and any credit portion 

earned, will either meet BOEM’s asking 

price or be reflected in the bidder’s own 

Intra-Round Bid price subject to certain 

conditions, as described more fully 

herein. A multiple-factor auction, 

wherein both monetary and 

nonmonetary bid variables are 

considered, is allowed under BOEM’s 

regulations at 30 CFR 585.220(a)(4) and 

585.221(a)(6). 

Overview of the Multiple-Factor Bidding 

Format Proposed for This Sale 

Under a multiple-factor bidding 

format, as set forth at 30 CFR 

585.220(a)(4), BOEM may consider 

many factors as part of a bid. The 

regulations state that one bid proposal 

per bidder will be accepted, but do not 

further specify the procedures to be 

followed in the multiple-factor format. 

This multiple-factor format is intended 

to allow BOEM flexibility in 

administering the auction and in 

balancing the variables presented. The 

regulations leave to BOEM the 

determination of how to administer the 

multiple-factor auction format to ensure 

the receipt of a fair return under the Act, 

43 U.S.C. 1337(p)(2)(A). 

BOEM’s regulations at 30 CFR 

585.220(a)(4) allow for a multi-round 

auction in which each bidder may 

submit only one proposal per LA or for 

a set of LAs in each round of the 

auction. The auction will be conducted 

in a series of rounds. At the start of each 

round, BOEM will state an asking price 

for the North LA and an asking price for 

the South LA. The asking price for a bid 

on both LAs is the sum of the asking 

prices for the North LA and the South 

LA. Each bidder will indicate whether 

it is willing to meet the asking price for 

one or both LAs. A bid submitted at the 

full asking price for one or both LAs in 

a particular round is referred to as a 

‘‘live bid.’’ A bidder must submit a live 

bid for at least one of the LAs in each 

round to participate in the next round 

of the auction. As long as there is at 

least one LA that is included in two or 

more live bids, the auction continues, 

and the next round is held. 

A bidder’s As-Bid price must meet the 

asking price in order for it to be 

considered a live bid. A bidder may 

meet the asking price by submitting a 

monetary bid equal to the asking price, 

or, if it has earned a credit, by 

submitting a multiple-factor bid—that 

is, a live bid that consists of a monetary 

element and a non-monetary element, 

the sum of which equals the asking 

price. A multiple-factor bid would 

consist of the sum of a cash portion and 

any credit portion which the bidder has 

earned. 

An uncontested bid is a live bid that 

does not overlap with other live bids in 

that round. For example, a bid for both 

the North and the South LAs is 

considered contested if any LA included 

in that bid is included in another bid— 

a bid cannot be ‘‘partially uncontested.’’ 

An uncontested bid represents the only 

apparent interest in that bid’s LA(s) at 

the asking price for that round. If a 

bidder submits an uncontested bid 

consisting of one LA, and the auction 

continues for another round, BOEM 

automatically carries that same live bid 

forward as a live bid into the next 

round, and BOEM’s asking price for the 

LA contained in the uncontested bid 

would remain unchanged from the 

previous round. If the price on the LA 

in that bid rises later in the auction 

because another bidder places a live bid 

on that LA, BOEM will stop 

automatically carrying forward the 

previously uncontested bid. Once the 

asking price goes up, the bidder that 

placed the previously carried-forward 

bid is free to bid on either lease area at 

the new asking prices. 

Following each round in which either 

LA is contained in more than one live 

bid, BOEM will raise the asking price 

for that LA by an increment determined 

by BOEM. The auction concludes when 

neither the North LA nor the South LA 

is included in more than one live bid. 

The series of rounds and the rising 

asking prices set by BOEM will facilitate 

consideration of the first variable—the 

cash portion of the bid. 

The second variable—a credit of up to 

25% of a monetary bid for holding a 

PPA or a Maryland OREC Order—will 

be applied throughout the auction 


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rounds as a form of imputed payment 

against the asking price for the highest 

priced LA in a bidder’s multiple-factor 

bid. This credit serves to supplement 

the amount of a cash bid proposal made 

by a particular bidder in each round. A 

bidder holding a qualified PPA or OREC 

Order will receive a credit of up to 25%. 

In the case of a bidder holding a credit 

and bidding on more than one LA, the 

credit will be applied only on the LA 

with the highest asking price. More 

details on the non-monetary factors are 

found in the ‘‘Credit Factors’’ section 

herein. 

The panel will evaluate non-monetary 

packages consisting of any purported 

PPA or qualified OREC Order to 

determine whether it meets the criteria 

provided in the FSN, and therefore 

whether it will qualify for a credit for its 

holder. It is possible that the panel 

could determine that no bidder qualifies 

for a non-monetary credit during the 

auction, in which case the auction 

would otherwise proceed as described 

in the FSN. The panel will determine 

the winning bids for each LA on the 

basis of the procedures described in the 

FSN. 

Details of the Auction Process 

Bidding—Live Bids 

Each bidder is allowed to submit a 

live bid for one LA (North or South), or 

both LAs based on its ‘‘eligibility’’ at the 

opening of each round. A bidder’s 

eligibility is either two, one, or zero 

LAs, and it corresponds to the 

maximum number of LAs that a bidder 

may include in a live bid during a single 

round of the auction. A bidder’s initial 

eligibility is determined based on the 

amount of the bid deposit submitted by 

the bidder prior to the auction. To be 

eligible to offer a bid on one LA at the 

start of the auction, a bidder must 

submit a bid deposit of $450,000. To be 

eligible to offer a bid on both the North 

and South LAs in the first round of the 

auction, the bidder must submit a bid 

deposit of $900,000. A bidder’s bid 

deposit will be used by BOEM as a 

down payment on any monetary 

obligations incurred by the bidder 

should it be awarded a lease. 

As the auction proceeds, a bidder’s 

eligibility is determined by the number 

of LAs included in its live bid submitted 

in the round prior to the current round. 

That is, if a bidder submitted a live bid 

on one LA in the previous round, that 

bidder may submit a bid that includes 

at most one LA in the current round. If 

a bidder submitted a live bid comprised 

of both LAs in the previous round, that 

bidder may submit a live bid that also 

includes these two LAs in the current 

round. In both cases, unless a bidder has 

an uncontested bid that is carried 

forward into the next round, the bidder 

also may choose to submit a live bid 

with fewer LAs than the maximum 

number it is eligible to include in its 

bid. Thus, eligibility in successive 

rounds may stay the same or go down, 

but it can never go up. 

In the first round of the auction, 

bidders have the following options: A 

bidder with an initial eligibility of one 

(that is, a bidder who submitted a bid 

deposit of $450,000) may: 

• Submit a live bid on the North LA 

or the South LA, or 

• Submit nothing, and drop out of the 

auction. 

A bidder with an initial eligibility of 

two (that is, a bidder who submitted a 

bid deposit of $900,000) may: 

• Submit a live bid for both the North 

and South LAs, 

• Submit a live bid for either the 

North LA or the South LA, or 

• Submit nothing, and drop out of the 

auction. 

Before each subsequent round of the 

auction, BOEM will raise the asking 

price for any LA that was contained in 

more than one live bid in the previous 

round. BOEM will not raise the asking 

price for a LA that was in only one or 

no live bids in the previous round. 

Asking price increments will be 

determined by BOEM, in its sole 

discretion. BOEM will base asking price 

increments on a number of factors, 

including: 

• Making the increments sufficiently 

large that the auction will not take an 

unduly long time to conclude; and 

• Decreasing the increments as the 

asking price of a LA nears its apparent 

final price. 

BOEM reserves the right during the 

auction to increase or decrease 

increments if it determines, in its sole 

discretion, that a different increment is 

warranted to enhance the efficiency of 

the auction process. Asking prices for 

the LAs included in multiple live bids 

in the previous round will be raised and 

rounded to the nearest whole dollar 

amount to obtain the asking prices in 

the current round. 

A bidder must submit a live bid in 

each round of the auction (or have an 

uncontested live bid automatically 

carried forward by BOEM) for it to 

remain active and continue bidding in 

future rounds. All of the live bids 

submitted in any round of the auction 

will be preserved and considered 

binding until determination of the 

winning bids is made. Therefore, the 

bidders are responsible for payment of 

the bids they submit and can be held 

accountable for up to the maximum 

amount of those bids determined to be 

winning bids during the final award 

procedures. 

Between rounds, BOEM will release 

the following information: 

• The level of demand for each LA in 

the previous round of the auction (i.e., 

the number of live bids that included 

the LA); and 

• The asking price for each LA in the 

upcoming round of the auction. 

In any subsequent round of the 

auction, if a bidder’s previous round bid 

was uncontested, and the auction 

continues for another round, then 

BOEM will automatically carry forward 

that bid as a live bid in the next round. 

A bidder whose bid is being carried 

forward will not have an opportunity to 

modify or drop its bid until some other 

bidder submits a live bid that overlaps 

with the LA in the carried forward bid. 

In particular, for rounds in which a 

bidder finds its uncontested bid is 

carried forward, the bidder will be 

unable to do the following: 

• Switch to the other LA; 

• Submit an Intra-Round Bid (see 

herein for discussion of Intra-Round 

Bids); or 

• Drop out of the auction. 

A bidder may be bound by that bid or, 

indeed, by any other bid which BOEM 

determines is a winning bid in the 

award stage. Hence, a bidder cannot 

drop an uncontested bid. In no scenario 

can a bidder be relieved of any of its 

bids from previous or future rounds 

until a determination is made in the 

award stage about the LAs won by the 

bidder. 

If a bidder’s bid is not being carried 

forward by BOEM, a bidder with an 

eligibility of one (that is, a bidder who 

submitted a live bid for either the North 

LA or the South LA in the previous 

round) may: 

• Submit a live bid for either the 

North LA or the South LA; 

• Submit an Intra-Round Bid for the 

same LA for which the bidder submitted 

a live in the previous round, and exit 

the auction; or 

• Submit nothing, and drop out of the 

auction. 

A bidder with an eligibility of two (that 

is, a bidder who submitted a live bid for 

both North and South in the previous 

round) may: 

• Submit a live bid for both the North 

and South LAs; 

• Submit a live bid for either the 

North LA or the South LA; 

• Submit an Intra-Round Bid for both 

the North and South LAs, and a live bid 

for either the North LA or the South LA; 

• Submit an Intra-Round Bid for both 

the North and South LAs, no live bids, 

and exit the auction; or 


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• Submit nothing, and drop out of the 

auction. 

Subsequent auction rounds occur in 

this sale as long as either the North LA 

or the South LA is contested. The 

auction concludes at the end of the 

round in which neither the North LA 

nor the South LA is included in the live 

bid of more than one bidder, i.e., all live 

bids are uncontested. 

Bidding—Intra-Round Bids 

All asking prices and asking price 

increments will be determined by the 

BOEM Auction Manager. Intra-round 

bidding allows bidders to more 

precisely express the maximum price 

they are willing to offer for the North, 

South, or both LAs while also 

minimizing the chance of ties. An intraround bid must consist of a single offer 

price for exactly the same LA(s) 

included in the bidder’s live bid in the 

previous round. 

When submitting an intra-round bid, 

the bidder is indicating that it is not 

willing to meet the current round’s 

asking price, but it is willing to pay 

more than the previous round’s asking 

price. In particular, in an intra-round 

bid, the bidder specifies the maximum 

(higher than the previous round’s asking 

price and less than the current round’s 

asking price) that it is willing to offer for 

the specific LA(s) in its previous 

round’s live bid. 

Although an intra-round bid is not a 

live bid, in the round in which a valid 

intra-round bid is submitted for both 

LAs, the bidder’s eligibility for a live bid 

in that same round and future rounds is 

permanently reduced from including 

two LAs to one LA. In other words, once 

an intra-round bid is submitted, the 

bidder will never again have the 

opportunity to submit a live bid on as 

many LAs as it has bid in previous 

rounds. 

BOEM will not consider intra-round 

bids for the purpose of determining 

whether to increase the asking price for 

a particular LA or to end the auction. 

Also, BOEM will not count or share 

with bidders between rounds the 

number of intra-round bids received for 

each LA. 

All of the intra-round bids submitted 

during the auction will be preserved, 

and may be determined to be winning 

bids. Therefore, bidders are responsible 

for payment of the bids they submit and 

may be held accountable for up to the 

maximum amount of any intra-round 

bids or live bids determined to be 

winning bids during the final award 

procedures. 

Determining Provisional Winners 

After the bidding ends, BOEM will 

determine the provisionally winning 

bids in accordance with the process 

described in this section. This process 

consists of two stages: Stage 1 and Stage 

2, which are described herein. Once the 

auction itself ends, nothing further is 

required of bidders within or between 

Stages 1 and 2. In practice, the stages of 

the process will take place as part of the 

solution algorithm for analyzing the 

monetary and credit portion of the bids, 

determining provisional winners, 

finding the LAs won by the provisional 

winners, and calculating the applicable 

bid prices to be paid by the winners for 

the LAs they won. This evaluation will 

be reviewed, checked and validated by 

the panel. The determination of 

provisional winners, in both stages, will 

be based on the two auction variables, 

as well as on a bidder’s adherence to the 

rules of the auction, and the absence of 

conduct detrimental to the integrity of 

the competitive auction. 

• Stage 1 

Live bids submitted in the final round 

of the auction are Qualified Bids. In 

Stage 1, a bidder with a Qualified Bid 

is provisionally assured of winning the 

LA(s) included in its final round bid, 

regardless of any other prior-to-final 

round live bids or Intra-Round Bids in 

any round. If both LAs are awarded to 

bidders in Stage 1, the second award 

stage is not necessary. If the North LA 

or the South LA received a bid but was 

not awarded in Stage 1 because no live 

bids were received in the final round of 

the auction, BOEM will proceed to Stage 

2 to award the leases. 

Following the auction, all winning 

bidders must pay the price associated 

with their winning bids, which may 

consist of cash and non-monetary 

credits or just cash. 

• Stage 2 

All bids are either Qualified Bids or 

Contingent Bids. Contingent bids are all 

live bids received before the final round, 

and any Intra-Round Bids received 

during the auction. In Stage 2, BOEM 

will consider Contingent Bids to see if 

the unawarded LA(s) can be awarded 

without interfering with Stage 1 awards. 

BOEM will award leases in Stage 2 to 

the bid(s) that maximize(s) the total AsBid prices. 

Any Contingent Bids that conflict 

with Qualified Bids will not be 

considered. There is one notable 

exception to this rule. This exception 

allows BOEM to accept a Contingent Bid 

for both LAs notwithstanding the 

existence of a Qualified Bid by the same 

bidder, provided the acceptance of the 

Contingent Bid for both LAs results in 

higher overall As-Bid prices than 

acceptance of only the Qualified Bid for 

a single LA. 

In this scenario, a bidder would be 

awarded both LAs and would be 

required to pay its Intra-Round Bid 

price associated with its Intra-Round 

Bid for both LAs, even though it 

submitted a Qualified Bid that 

guaranteed only one of the LAs. 

This exception represents the only 

situation in which BOEM will consider 

for award a Contingent Bid which 

overlaps a Qualified Bid. In contrast, 

there is no situation in which one 

bidder’s Contingent Bid will be 

considered for award if it overlaps with 

any LA that is included in another 

bidder’s Qualified Bid. 

Under certain circumstances, different 

combinations of contingent bids may 

result in the same total As-Bid price. In 

such cases, BOEM will resolve the 

resulting tie with a random drawing. 

In the event a bidder submits a bid for 

a LA that the panel and BOEM 

determine to be a winning bid, the 

bidder will be expected to sign the 

applicable lease documents in a timely 

manner and submit the full cash 

payment due, pursuant to 30 CFR 

585.224. If a bidder fails to timely sign 

and pay for the lease, then BOEM will 

not issue the lease to that bidder, and 

the bidder will forfeit its bid deposit. 

BOEM may consider failure of a bidder 

to timely pay the full amount due an 

indication that the bidder is no longer 

financially qualified to participate in 

other lease sales under BOEM’s 

regulations at 30 CFR 585.106 and 

585.107. 

Credit Factors 

Prior to the auction, BOEM will 

convene a panel to evaluate bidders’ 

non-monetary packages to determine 

whether and to what extent each bidder 

is eligible for a non-monetary credit 

applicable to the As-Bid auction price 

for one of the LAs in each round of the 

auction, as described herein. Any single 

PPA or Maryland OREC Order cannot be 

used by more than one bidder in the 

auction. 

The percentage credit is determined 

based on the panel’s evaluation of 

required documentation submitted by 

the bidders as of the deadline specified 

in the FSN. Bidders will be informed by 

email before the monetary auction about 

the percentage credit applicable to their 

bids. The bid credit will be applicable 

to only one LA. Any non-monetary 

credit would only be applicable to the 

higher priced LA in a bid for both LAs. 

For an Intra-Round Bid containing both 


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LAs, the higher priced LA will be 

determined using the previous round’s 

asking prices. In each round, the auction 

system will display information 

showing how their As-Bid auction 

prices are affected by the credit imputed 

to their bid to determine their net 

monetary payment due to BOEM, 

should their bids prevail as winning 

bids in the award stages. Application of 

the credit percentage to the appropriate 

As-Bid auction price will be rounded to 

the nearest whole dollar amount. 

The bidder’s imputed credit 

throughout the auction and award 

process is limited to the greater of 25% 

for a Maryland OREC Order, or up to 

25% for a PPA (for at least 250 MW), 

applied to the highest priced LA related 

to the bidder’s latest live bid or IntraRound Bid. During each round, bidders 

are informed by the BOEM Auction 

System how the credit applies to their 

live bid and any Intra-Round Bid. In the 

case of an Intra-Round Bid for both LAs, 

the credit will apply only to the higherpriced LA, but the applicable price for 

calculating the credit will be based on 

the previous round’s asking prices, not 

on any additional amount above the 

previous round’s asking prices as 

reflected in the incremental amount 

associated with its Intra-Round Bid. 

The panel will review the nonmonetary package submitted by each 

bidder, and determine whether bidders 

have established that they are qualified 

to receive a credit, and the percentage 

at which that credit will apply, based on 

the definitional information of a PPA 

and an OREC application, as described 

herein. If the panel determines that no 

bidder has qualified for a non-monetary 

factor, the auction will proceed with 

each bidder registered with no imputed 

credit. 

Credit Factor Definitions 

The definitions herein will apply to 

the factors for which bidders may earn 

a credit. 

Power purchase agreement (PPA) is 

any legally enforceable long-term 

contract negotiated between an 

electricity generator (Generator) and a 

power purchaser (Buyer) that identifies, 

defines, and stipulates the rights and 

obligations of one party to produce, and 

the other party to purchase, energy from 

an offshore wind project to be located in 

the lease sale area. The PPA must have 

been approved by a public utility 

commission or similar legal authority. 

The PPA must state that the Generator 

will sell to the Buyer and the Buyer will 

buy from the Generator capacity, energy, 

and/or environmental attribute products 

from the project, as defined in the terms 

and conditions set forth in the PPA. 

Energy products to be supplied by the 

Generator and the details of the firm 

cost recovery mechanism approved by 

the state’s public utility commission or 

other applicable authority used to 

recover expenditures incurred as a 

result of the PPA must be specified in 

the PPA. To qualify, a PPA must contain 

the following terms or supporting 

documentation: 

(i) A complete description of the 

proposed project; 

(ii) Identification of both the 

electricity Generator and Buyer that will 

enter into a long term contract; 

(iii) A time line for permitting, 

licensing, and construction; 

(iv) Pricing projected under the long 

term contract being sought, including 

prices for all market products that 

would be sold under the proposed long 

term contract; 

(v) A schedule of quantities of each 

product to be delivered and projected 

electrical energy production profiles; 

(vi) The term for the long-term 

contract; 

(vii) Citations to all filings related to 

the PPA that have been made with state 

and Federal agencies, and identification 

of all such filings that are necessary to 

be made; and 

(viii) Copies of or citations to 

interconnection filings related to the 

PPA. 

If the panel determines a bidder has 

executed a PPA for at least 250 MW, it 

will be eligible for the entire 25% credit. 

If the panel determines a bidder has 

executed a PPA for an amount less than 

250 MW, the bidder may still be eligible 

for a non-monetary credit proportional 

to the PPA’s fraction of 250 MW. The 

smaller percentage for a partial credit 

will be calculated according to the 

formula below: 

Where: 

• Partial Credit = Percent credit for which a 

smaller PPA is eligible. 

• Full PPA = 250 MW 

• Full Credit = 25% 

• Partial PPA = amount (less than 250 MW) 

of power under contract 

Maryland OREC Order is an order 

issued by the Maryland PSC approving 

a qualifying offshore wind project and 

establishing an OREC pricing schedule, 

pursuant to Md. Public Utilities Code 

Ann. § 7–704.1. 

Additional Information Regarding the 

Auction Format 

Non-Monetary Auction Procedures 

All bidders seeking a non-monetary 

auction credit will be required to submit 

a non-monetary auction package prior to 

the auction. Instructions and deadlines 

for submittal will be provided in the 

FSN. If a bidder does not submit a nonmonetary package by the date specified 

in the FSN, then BOEM will assume that 

bidder is not seeking a non-monetary 

auction credit and the panel will not 

consider that bidder for a non-monetary 

auction credit. 

Bidder Authentication 

Prior to the auction, the Auction 

Manager will send several bidder 

authentication packages to each bidder 

shortly after BOEM has processed the 

BFFs. One package will contain tokens 

for each authorized individual. Tokens 

are digital authentication devices. The 

tokens will be mailed to the Primary 

Point of Contact indicated on the BFF. 

This individual is responsible for 

distributing the tokens to the 

individuals authorized to bid for that 

company. Bidders are to ensure that 

each token is returned within three 

business days following the auction. An 

addressed, stamped envelope will be 

provided to facilitate this process. In the 

event that a bidder fails to submit a BFF, 

a bid deposit, or does not participate in 

the auction, BOEM will de-activate that 

bidder’s token and login information, 

and the bidder will be asked to return 

its tokens. 

The second package contains login 

credentials for authorized bidders. The 

login credentials will be mailed to the 

address provided in the BFF for each 

authorized individual. Bidders can 

confirm these addresses by calling 703– 

787–1320. This package will contain 

user login information and instructions 

for accessing the Auction System 

Technical Supplement and Alternative 

Bidding Form. The login information, 

along with the tokens, will be tested 

during the Mock Auction. 


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Monetary Auction Times 

This information will be elaborated 

on in the FSN and further clarified at 

the Mock Auction to be held prior to the 

lease sale. Additional information will 

be made available in an Auction System 

Technical Supplement, which will be 

posted on BOEM’s Web site prior to the 

auction. 

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 may change the 

schedule at any time, including during 

the auction. If BOEM changes the 

schedule during the auction, it will use 

the messaging feature to notify bidders 

that a revision has been made, and 

direct bidders to the relevant page. 

BOEM will also use the messaging 

system for other changes and items of 

particular note during the auction. The 

auction schedule and asking price 

increments are in BOEM’s discretion, 

and are subject to change at any time 

before or during the auction. 

During the auction, bidders may place 

bids at any time during the round. At 

the top of the bidding page, a 

countdown clock will show how much 

time remains in the round. Bidders have 

until the scheduled time to place bids. 

Bidders should do so according to the 

procedures described in the Auction 

System Technical Supplement, and as 

practiced at the Mock Auction. No 

information about the round is available 

until the round has closed and results 

have been posted, so there should be no 

strategic advantage to placing bids early 

or late in the round. 

Alternate Bidding Procedures 

Any bidder who is unable to place a 

bid using the online auction should 

follow these instructions: 

• Call BOEM/the BOEM Auction 

Manager at the help desk number that 

is listed in the Auction System 

Technical Supplement before the end of 

the round. 

• BOEM will authenticate the caller 

to ensure he/she is authorized to bid on 

behalf of the company. 

• Explain the problem. 

• BOEM may, in its sole discretion, 

accept a bid using the Alternative 

Bidding Procedure. 

• The Alternative Bidding Procedure 

enables a bidder who is having 

difficulties accessing the Internet to 

submit its bid via an Alternative 

Bidding Form that must be faxed to the 

auction manager. 

Æ If the bidder has not placed a bid, 

but calls BOEM before the end of the 

round and notifies BOEM that it is 

preparing a bid using the Alternate 

Bidding Procedure, and submits the 

Alternate Bidding Form by fax before 

the round ends, BOEM will likely 

accept the bid, though acceptance or 

rejection of the bid is within BOEM’s 

sole discretion. 

Æ If the bidder calls during the round, 

but does not submit the bid until after 

the round ends (but before the round is 

posted), BOEM may or may not accept 

the bid, in part based on how much time 

remains in the recess. Bidders are 

strongly encouraged to submit the 

Alternative Bidding Form before the 

round ends. 

Æ If the bidder calls during the recess 

following the round, but before the 

previous round’s results have been 

posted, BOEM will likely reject its bid, 

even if it has otherwise complied with 

all of BOEM’s Alternate Bidding 

Procedures. 

Æ If the bidder calls to enter a bid 

after results have been posted, BOEM 

will reject the bid. 

Except for bidders who have 

uncontested bids in the current round, 

failure to place a bid during a round 

will be interpreted as dropping out of 

the auction. Bids in all rounds are 

preserved for consideration in Stage 2 of 

the award process. Bidders are held 

accountable for all bids placed during 

the auction. This is true if they 

continued bidding in the last round, if 

they placed an Intra-Round Bid for a 

single LA in an earlier round, or if they 

stopped bidding during the auction. 

Acceptance, Rejection, or Return Of 

Bids: BOEM reserves the right and 

authority to reject any and all bids. No 

leases will be awarded to any bidders 

and no bids will be accepted, unless (1) 

the bidder has complied with all 

requirements of the FSN, applicable 

regulations and statutes, including, but 

not limited to, bidder qualifications, bid 

deposits, and adherence to the integrity 

of the competitive bidding process, (2) 

the bid conforms with the requirements 

and rules of the auction, and (3) the 

amount of the bid has been determined 

to be adequate by the authorized officer. 

Any bid submitted that does not satisfy 

these requirements may be returned to 

the bidder by the Program Manager of 

BOEM’s Office of Renewable Energy 

Programs and, in that case, would not be 

considered for acceptance. 

Process for Issuing the Leases: If 

BOEM proceeds with lease issuance, it 

will issue three unsigned copies of the 

lease form to each winning bidder. 

Within 10 business days after receiving 

the lease copies, a winning bidder must: 

1. Execute the lease 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 of the bonus bid (bid 

amount less the bid deposit). BOEM 

requires bidders to use EFT procedures 

(not to include pay.gov) for payment of 

the balance of the bonus bid, following 

the detailed instructions contained in 

the ‘‘Instructions for Making Electronic 

Payments’’ available on BOEM’s Web 

site at: http://www.boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. 

If a winning bidder does not meet 

these three requirements within 10 

business days of receiving the lease 

copies as described herein, or if a 

winning bidder otherwise fails to 

comply with applicable regulations or 

the terms of the FSN, the winning 

bidder will forfeit its bid deposit. BOEM 

may extend this 10 business-day time 

period if it determines the delay was 

caused by events beyond the winning 

bidder’s control. 

In the event that the provisional 

winner does not execute and return the 

leases according to the instructions in 

the FSN, BOEM reserves the right to 

reconvene the panel to determine 

whether it is possible to identify a bid 

that would have won in the absence of 

the bid previously determined to be the 

winning bid. In the event that a new 

winning bid is selected by the panel, 

BOEM will follow the procedures in this 

section for the new winner(s). 

BOEM will not execute a lease until 

(1) the three requirements above have 

been satisfied, (2) BOEM has accepted 

the winning bidder’s financial 

assurance, and (3) BOEM has processed 

the winning bidder’s payment. The 

winning bidder may meet financial 

assurance requirements by posting a 

surety bond or by setting up an escrow 

account with a trust agreement giving 

BOEM the right to withdraw the money 

held in the account on demand by 

BOEM. BOEM may accept other forms 

of financial assurance on a case-by-case 

basis in accordance with its regulations. 

BOEM encourages provisionally 

winning bidders to discuss the financial 

assurance requirement with BOEM as 

soon as possible after the auction has 

concluded. 

Within 45 days of the date that the 

winning bidder receives the lease 

copies, the winning bidder must pay the 

first 6-months’ rent using the pay.gov 

Renewable Energy Initial Rental 

Payment form available at: https:// 

pay.gov/paygov/forms/

formInstance.html?agencyFormId=

27797604. 

The Lessee must pay the remaining 6- 

months’ rent by the first day of the 


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Federal Register / Vol. 78, No. 243 / Wednesday, December 18, 2013 / Notices 76653 

seventh month following the effective 

date of the lease, following the detailed 

instructions contained in the 

‘‘Instructions for Making Electronic 

Payments’’ available on BOEM’s Web 

site at: http://www.boem.gov/

Renewable-Energy-Program/StateActivities/Maryland.aspx. 

Anti-Competitive Behavior: In 

addition to the auction rules described 

in this notice, bidding behavior is 

governed by Federal antitrust laws 

designed to prevent anticompetitive 

behavior in the marketplace. 

Compliance with BOEM’s auction 

procedures will not insulate a party 

from enforcement of antitrust laws. 

In accordance with the Act at 43 

U.S.C. 1337(c), following the auction, 

and before the acceptance of bids and 

the issuance of leases, BOEM will 

‘‘allow the Attorney General, in 

consultation with the Federal Trade 

Commission, thirty days to review the 

results of the lease sale.’’ If a bidder is 

found to have engaged in anticompetitive behavior or otherwise 

violated BOEM’s rules in connection 

with its participation in the competitive 

bidding process, BOEM may reject the 

high bid. 

Anti-competitive behavior 

determinations are fact specific. 

However, such behavior may manifest 

itself in several different ways, 

including, but not limited to: 

• An agreement, either express or 

tacit, among bidders to not bid in an 

auction, or to bid a particular price; 

• An agreement among bidders not to 

bid for a particular LA; 

• An agreement among bidders not to 

bid against each other; and 

• Other agreements among bidders 

that have the effect of limiting the final 

auction price. 

BOEM may decline to award a lease if 

doing so would otherwise create a 

situation inconsistent with the antitrust 

laws (e.g., heavily concentrated market, 

etc.). 

For more information on whether 

specific communications or agreements 

could constitute a violation of Federal 

antitrust law, please see: http:// 

www.justice.gov/atr/public/businessresources.html, or consult counsel. 

Bidder’s Financial Form Certification: 

Each bidder is required to sign the selfcertification, in accordance with 18 

U.S.C. 1001 (Fraud and False 

Statements) in the Bidder’s Financial 

Form, which can be found on BOEM’s 

Web site at: http://boem.gov/RenewableEnergy-Program/State-Activities/

Maryland.aspx. The form must be filled 

out and returned to BOEM in 

accordance with the ‘‘Deadlines and 

Milestones for Bidders’’ section of this 

notice. 

Non-Procurement Debarment and 

Suspension Regulations: Pursuant to 

regulations at 43 CFR Part 42, Subpart 

C, an OCS renewable energy Lessee 

must comply with the U.S. Department 

of the Interior’s non-procurement 

debarment and suspension regulations 

at 2 CFR 180 and 1400 and agree to 

communicate the requirement to 

comply with these regulations to 

persons with whom the Lessee does 

business as it relates to this lease by 

including this term as a condition in 

their contracts and other transactions. 

Final Sale Notice: BOEM will 

consider comments received or 

postmarked during the PSN comment 

period in preparing a FSN that will 

provide the final details concerning the 

offering and issuance of OCS 

commercial wind energy leases in the 

Maryland WEA. 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. 

Force Majeure: The Program Manager 

of BOEM’s Office of Renewable Energy 

Programs has the discretion to change 

any date, time, and/or location specified 

in the FSN in case of a force majeure 

event that the Program Manager deems 

may interfere with a fair and proper 

lease sale process. Such events may 

include, but are not limited to, natural 

disasters (e.g., earthquakes, hurricanes, 

floods), wars, riots, acts of terrorism, 

fire, strikes, civil disorder or other 

events of a similar nature. In case of 

such events, bidders should call 703– 

787–1320 or access the BOEM Web site 

at: http://www.boem.gov/RenewableEnergy-Program/index.aspx. 

Appeals: The appeals procedures are 

provided in BOEM’s regulations at 30 

CFR 585.225 and 585.118(c). Pursuant 

to 30 CFR 585.225, 

(a) If BOEM rejects your bid, BOEM 

will provide a written statement of the 

reasons and refund any money 

deposited with your bid, without 

interest. 

(b) You will then be able to ask the 

BOEM Director for reconsideration, in 

writing, within 15 business days of bid 

rejection, under 30 CFR 585.118(c)(1). 

BOEM will send you a written response 

either affirming or reversing the 

rejection. 

The procedures for appealing adverse 

final decisions with respect to lease 

sales are described in 30 CFR 

585.118(c). 

Protection of Privileged or Confidential 

Information 

BOEM will protect privileged or 

confidential information that is 

submitted as required by the Freedom of 

Information Act (FOIA). Exemption 4 of 

FOIA applies to trade secrets and 

commercial or financial information 

that is privileged or confidential. If you 

wish to protect the confidentiality of 

such information, clearly mark it and 

request that BOEM treat it as 

confidential. BOEM will not disclose 

such information, except as required by 

FOIA. Please label privileged or 

confidential information ‘‘Contains 

Confidential Information’’ and consider 

submitting such information as a 

separate attachment. 

However, BOEM will not treat as 

confidential any aggregate summaries of 

such information or comments not 

containing such information. 

Additionally, BOEM may not treat as 

confidential the legal title of the 

commenting entity (e.g., the name of a 

company). Information that is not 

labeled as privileged or confidential will 

be regarded by BOEM as suitable for 

public release. 

Section 304 of the National Historic 

Preservation Act (16 U.S.C. 470w–3(a)) 

BOEM is required, after consultation 

with the Secretary of the Interior, to 

withhold the location, character, or 

ownership of historic resources if it 

determines 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 wish to be held as 

confidential. 

Dated: November 30, 2013. 

Tommy P. Beaudreau, 

Director, Bureau of Ocean Energy 

Management. 

[FR Doc. 2013–29977 Filed 12–17–13; 8:45 am] 

BILLING CODE 4310–MR–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation Nos. 701–TA–417 and 731– 

TA–953, 957–959, 961, and 962 (Second 

Review)] 

Carbon and Certain Alloy Steel Wire 

Rod From Brazil, Indonesia, Mexico, 

Moldova, Trinidad and Tobago, and 

Ukraine 

Scheduling of full five-year reviews 

concerning the countervailing duty 

order on carbon and certain alloy steel 


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