logo
Article

Eversource mulls Orsted US offshore wind split amid 'record prices'

Recharge Magazine|Andrew Lee |May 5, 2022
USAOffshore Wind

Eversource could sell its share of its offshore wind joint venture with Orsted after the regional US utility launched a strategic review of a partnership that is developing some of America’s pioneering projects off the nation’s Northeast. 

Eversource said it expects the review by the end of the year to decide whether a disposal of part or all of the 50-50 JV is the right option, after launching the process “in light of the record-setting prices in the recent federal lease auction for tracts around the New York Bight and an evolving landscape”.


Regional utility launches strategic review of JV with global sector pacesetter citing New York Bight round and 'evolving landscape' of regional market

Eversource could sell its share of its offshore wind joint venture with Orsted after the regional US utility launched a strategic review of a partnership that is developing some of America’s pioneering projects off the nation’s Northeast.

Eversource said it expects the review by the end of the year to decide whether a disposal of part or all of the 50-50 JV is the right option, after launching the process “in light of the record-setting prices in the recent federal lease auction for tracts around the New York Bight and an evolving landscape”.

The JV covers three projects totaling 1.8GW already in construction or with power deals – South Fork, Revolution and Sunrise – and 175,000 acres of leased seabed area.

Eversource said if it does decide to exit the JV, it would use the proceeds to help fund some $18bn of regulated investments it already needs to make in its ... more [truncated due to possible copyright]

     

Regional utility launches strategic review of JV with global sector pacesetter citing New York Bight round and 'evolving landscape' of regional market

Eversource could sell its share of its offshore wind joint venture with Orsted after the regional US utility launched a strategic review of a partnership that is developing some of America’s pioneering projects off the nation’s Northeast.

Eversource said it expects the review by the end of the year to decide whether a disposal of part or all of the 50-50 JV is the right option, after launching the process “in light of the record-setting prices in the recent federal lease auction for tracts around the New York Bight and an evolving landscape”.

The JV covers three projects totaling 1.8GW already in construction or with power deals – South Fork, Revolution and Sunrise – and 175,000 acres of leased seabed area.

Eversource said if it does decide to exit the JV, it would use the proceeds to help fund some $18bn of regulated investments it already needs to make in its business by 2026, plus extra spending such as offshore wind transmission assets.

The utility’s CEO Joe Nolan said: “Eversource remains committed to supporting offshore wind with advocacy, transmission investment solutions, and clean energy resource integration. We have seen up close why Orsted is unquestionably the world leader in engineering, building and operating offshore wind and have no doubt that the joint venture we launched five years ago will be a tremendous source of clean energy and economic development for the Northeast.”

Eversource has hired Goldman Sachs and Ropes & Gray to advise on the review, which it insisted will not affect progress of the projects. The 130MW South Fork will be the second commercial-scale US project with first power set to flow to Long Island, New York, as soon as the end of next year.

Orsted's offshore wind CEO in North America David Hardy said: “Eversource has been a valuable local partner for us as we’ve grown our business and successfully advanced our vision in the US market, which has expanded, matured and appreciated since Eversource partnered with us in 2016. The New York Bight auction results validate this trend and demonstrate the opportunities ahead for the US market.

“We will be engaged in the strategic review throughout the process, while Eversource and Orsted continue to advance and build out projects in the joint venture unimpacted by this initiative.”

Five-year partnership

Eversource first partnered with the Danish sector pacesetter off Massachusetts five years ago and cemented the relationship in early 2019 with a 50% deal for the projects covering Revolution and South Fork. That sale, which also included two undeveloped lease areas off New England, cost Eversource $225m, a high figure at the time but one that now looks a bargain.

This year’s New York Bight seabed round saw global energy majors such as RWE and TotalEnergies pay sums in the billions for development rights in a sale that raised $4.4bn in total.

That led to claims that the amount paid would drive up the cost of green power, and make it harder for developers to make much-needed investments in infrastructure and the supply chain.

Orsted’s Hardy said after the auction – which the Danish group stepped away from as prices rose – that the outcome was bad for the sector. “The price of offshore wind in New Jersey and New York just went up. I think it will slow the energy transition, or the offshore energy transition at least.”

 


Source:https://www.rechargenews.com/…

Share this post
Follow Us
Donate
Stay Updated

We respect your privacy and never share your contact information. | LEGAL NOTICES

Contact Us

WindAction.org
Lisa Linowes, Executive Director
phone: 603.838.6588

Email contact

General Copyright Statement: Most of the sourced material posted to WindAction.org is posted according to the Fair Use doctrine of copyright law for non-commercial news reporting, education and discussion purposes. Some articles we only show excerpts, and provide links to the original published material. Any article will be removed by request from copyright owner, please send takedown requests to: info@windaction.org

© 2022 INDUSTRIAL WIND ACTION GROUP CORP. ALL RIGHTS RESERVED
WEBSITE GENEROUSLY DONATED BY PARKERHILL TECHNOLOGY CORPORATION