Eversource confirms late stage talks with buyer of 50% stake in Orsted US offshore wind JV
New England utility has completed its end of the bargain and is waiting for undisclosed investor to hammer out agreements with the Dane
Boston-based utility Eversource Energy confirmed in its third quarter earnings call Monday that it was in late-stage talks with a buyer for its 50% stake in an offshore wind joint venture (JV) with Danish developer Orsted covering some 1.7GW of capacity.
The duo owns three of US' earliest wave projects, including the 132MW South Fork, 704MW Revolution, and 920MW Sunrise arrays.
“We have substantially completed our contract negotiations with a buyer and continue to make good progress on this front," said Eversource CEO Joe Nolan.
“What remains to be completed is for the buyer and Orsted to finalise several documents, such as their new joint venture agreement.
“We expect this process to wrap up shortly, allowing us to execute our sales agreement with the buyer and announce the terms of the sale,” he added, without identifying the potential buyer.
South Fork is currently in offshore installation and expects to have seven to nine turbines completed by the end of this year, with all 12 Siemens Gamesa 11MW turbines in commercial operation by early next year, a delay from the original timeline of 2023.
Both New York developers, Orsted-Eversource and Equinor-BP, owners of over 3GW of project capacity, had petitioned the state for contract hikes to compensate for soaring costs.
With PSC's decision putting nearly all its contracted projects in jeopardy, New York Energy Research and Development Authority (Nyserda), overseer of the state's energy transition, announced another tender as early as year's end for up to 4GW of replacement capacity.
“We are very encouraged to see that New York is working to establish an accelerated rebidding process,” said Nolan.
With Orsted, “we will work towards developing a bid that will reflect the attractive nature of this project. We feel confident that Sunrise Wind will deliver clean and reliable energy to New York and support economic development in the region much earlier than many other projects,” he added.
In order to resubmit Sunrise, the JV would need to cancel the current project, which it hasn't.
Nyserda confirmed none of New York's awarded capacity has been cancelled. The regulator closed its request for information 2 November and “is reviewing the responses and considering how best to proceed,” said a spokesperson.
Eversource CFO John Moreira said that the company could potentially sell its stakes in Revolution and South Fork first and Sunrise in a second transation to the same buyer, depending on the outcome of New York's next offshore wind procurement.
“From a project financing standpoint, you need to be locked in on the revenue agreement,” said Moreira.
“If there's an ability for us to enhance the revenue agreement, and that takes four or five months, we are very supportive of that project.”
Nyserda recently awarded over 4GW of offtake contracts in its round 3 tender towards its mandate of 9GW by 2035.
WTIV solved
The WTIV was initially contracted for Revolution and Sunrise in 2024 before segueing to Dominion's 2.6GW Coastal Virginia Offshore Wind.
“We have also identified solutions for our installation vessel,” confirmed Nolan, adding that Eversource is confident it can “maintain the project schedule for Sunrise Wind and Revolution and we expect both projects to be in service in late 2025.”
Nolan predicted a boom in transmission capacity on the strength of joint procurement efforts for more than 6GW of offshore wind taken by Connecticut, Massachusetts, and Rhode Island as well as a tripling of electricity demand by 2050.
“Eversource will play a key role in providing the transmission and distribution infrastructure investment needed,” he said.
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