Eversource Ponders Exiting Offshore Wind Venture with Ørsted

US energy company Eversource has initiated a strategic review of its offshore wind investment portfolio which could result in a potential sale of all or part of its 50 per cent interest in its offshore wind joint venture with Ørsted.

The Massachusetts-headquartered Eversource expects to complete this review during 2022.

If the recommended path forward following the strategic review is a sale of all or part of Eversource’s interest in the joint venture, it is expected that potential proceeds from such transaction would likely be used to support the company’s regulated investments in strengthening, modernizing and decarbonizing its regulated energy and water delivery systems.

”In light of the record-setting prices in the recent federal lease auction for tracts around the New York Bight and an evolving landscape, we are conducting a fulsome review of our interest in the joint venture with Ørsted to assess alternatives that will allow us to create shareholder value and continue building a leading clean energy company that is wholly supportive of our region’s climate change goals,” Joe Nolan, Eversource’s President and Chief Executive Officer, said.

”Eversource remains committed to supporting offshore wind with advocacy, transmission investment solutions, and clean energy resource integration. We have seen up close why Ørsted 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.”

The joint venture includes three contracted projects with a total capacity of approximately 1,758 MW, as well as up to 175,000 acres of offshore wind area located 25 miles off the Massachusetts South Coast that is open for additional wind development and not allocated to a specific project.

The existing projects include the 130 MW South Fork Wind, the 704 MW Revolution Wind, and the 924 MW Sunrise Wind.

The construction of the South Fork Wind project started earlier this year and the wind farm is scheduled for commissioning in late 2023. Located 35 miles east of Long Island’s Montauk Point, the wind farm will interconnect into eastern Long Island where it will deliver power to households under a long-term power purchase agreement with the Long Island Power Authority.

Revolution Wind, located approximately 15 miles south of the Rhode Island coast, will deliver power under long-term contracts to Rhode Island (400 MW) and Connecticut (304 MW) once commissioned in 2025.

Located approximately 30 miles east of Long Island’s Montauk Point, Sunrise Wind will deliver power to New York State under a long-term purchase agreement with NYSERDA. Sunrise Wind is expected to be commissioned in late 2025.

As the strategic review proceeds, Eversource said it is committed to continuing to provide oversight of the siting and construction of onshore elements of the three active projects, adding that the progress on the development of the three projects will not be affected by the review.

”Eversource has solicited Ørsted’s input on the process of our strategic review and will continue to engage with our partner as the process moves forward,” Nolan said.

Eversource has engaged Goldman Sachs and Ropes & Gray as advisors for this strategic review.

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