Massachusetts, Connecticut and a Rhode Island utility are delaying a joint offshore wind auction by nearly two months as they seek clarity from the US government on federal clean energy tax credits.

The Massachusetts Department of Energy Resources on Jan. 18 postponed its deadline for offshore wind bids to March 27, from Jan. 31, as the state awaits guidance from the Biden administration. PPL Corp.'s Rhode Island Energy, required by Rhode Island to procure offshore wind, and Connecticut's Department of Energy and Environmental Protection delayed their respective deadlines to March 27.

Massachusetts, Connecticut and Rhode Island signed an agreement in October 2023 to coordinate on offshore wind procurement by seeking multistate proposals in three separate state auctions. The original deadline to submit bids had been scheduled in anticipation of pending guidance from the US Treasury Department on investment tax credits, with a provision to postpone that deadline if the guidance was not issued by a certain time.

Treasury has yet to release final guidance on the subsidy, authorized by the US Inflation Reduction Act of 2022. In the meantime, the department is seeking stakeholder input on proposed changes to the tax credit clarifying which types of energy property are eligible.

"The provisions could potentially reduce costs and resulting bid prices within offshore wind proposals," the Massachusetts Department of Energy Resources' attorneys wrote in a Jan. 18 notice. The department issued its request for proposals jointly with Massachusetts electric companies.

"In light of the current uncertainty around federal tax guidance, petitioners are concerned that the existing solicitation schedule may produce bids that do not maximize the potential clean energy tax benefits of offshore wind and result in the lowest cost for Massachusetts ratepayers," the notice continued. "Allowing additional time for bid submission would allow bidders to put forward proposals that incorporate with greater certainty, all available federal tax credits."

Under the amended schedule, the long-term wind contracts will be executed in October and submitted for approval in November.

Earlier this month, Vineyard Wind LLC's Vineyard Offshore Wind Project delivered power to the New England grid for the first time. The project was only the second utility-scale offshore wind farm to produce power in the US. The other is the South Fork Offshore Wind Project, which started generating electricity in December 2023 off Long Island, NY.