By GREGORY ZELLER //
With the fate of an ambitious offshore-wind farm hanging in the balance, two energy powerhouses – and longtime partners – are jockeying for position in New York waters.
Denmark-based Ørsted A/S has signed an agreement with Massachusetts-based Eversource Energy to acquire Eversource’s 50 percent share of Sunrise Wind, a proposed 924-megawatt offshore-wind farm slated to deliver power directly to Long Island. Terms of the deal were not disclosed.
Among other stipulations, the buyout is only viable if Sunrise Wind is provisionally selected during New York State’s fourth solicitation for offshore-wind capacity, which is underway now.
The deal also hinges on a new Offshore Wind Renewable Energy Certificates contract with the New York State Energy Research and Development Authority, the creation and approval of a new Construction and Operations Plan and relevant regulatory approvals.
If Sunrise Wind earns provisional approval in “New York 4,” a new contract will be negotiated with NYSERDA under the updated terms of the current solicitation. Sunrise is the latest offshore-wind project looking to tear up an existing state contract and seek more favorable terms under the new solicitation; earlier this month, Norwegian energy firm Equinor and British project partner BP announced they were terminating their proposed Empire Wind 2 offshore wind farm, while leaving the door open to a return under the new solicitation.
If Sunrise Wind does not bounce back under New York 4, the existing OREC contract will be canceled and Ørsted and Eversource’s current 50/50 arrangement will remain intact. At that point, the joint venture will “evaluate its next steps,” Ørsted said Wednesday.
Either way, the buyout plan is a huge development for the Ørsted/Eversource partnership, which dates back to 2016 – and it ultimately bodes well for Sunrise Wind, according to Ørsted Group Executive Vice President and CEO of Region Americas David Hardy, who called the potential buyout “the best path forward for the project.”
David Hardy: Risk/reward.
“Following a thorough risk review of our U.S. portfolio, we’re comfortable with taking full ownership of Sunrise Wind if the project is awarded in New York 4,” Hardy said in a statement. “This transaction is a value-accretive opportunity for Ørsted.”
Now targeted for completion in 2026, Sunrise Wind has already cleared several regulatory hurdles and gained plenty of government support.
It was billed as “the largest commitment to offshore wind in the U.S.” when then-Gov. Andrew Cuomo granted Sunrise Wind its first OREC contract in 2019. Two years later, it was the centerpiece of an $86 million supply-chain contract labeled by Gov. Kathy Hochul’s office as “the largest single offshore-wind supply chain contract award” in state history.
In 2022, the project earned New York Public Service Commission approvals; in 2023, it won an economic-incentives package from the Town of Brookhaven Industrial Development Agency, related to the construction of a de facto headquarters facility in East Setauket.
Besides the 2019 OREC contract, those myriad approvals and deals remain in place – and Northeast waters remain “an increasing priority for Ørsted, including … port assets, a trained workforce and supply-chain partners,” according to Hardy.
“Sunrise Wind will be our third offshore wind farm off the Northeast coast, following South Fork (Wind) and Revolution Wind, which are already under construction,” Ørsted’s Americas CEO added. “We’re building a future offshore wind hub that is strategic for Sunrise Wind, if awarded, as well as for upcoming solicitations in the region.”
Joseph Nolan: Forward focus.
The potential buyout by no means marks an end to the Ørsted/Eversource alliance. The international partners are still double-teaming South Fork Wind, a 132-megawatt effort already dubbed “America’s first completed utility-scale offshore wind farm,” and Revolution Wind, promising 704 MWs for end-users in Connecticut and Rhode Island.
Construction of South Fork Wind – which officially began in November about 35 miles east of Montauk Point – has now “passed the halfway mark,” according to Ørsted, while work on offshore and onshore Revolution Wind assets is also underway.
Ørsted and Eversource are also pouring hundreds of millions of dollars into shipbuilding across the United States, including the Louisiana-based construction of the U.S.-flagged ECO Edison – the first purpose-built ship for offshore-wind service operations, ticketed for eventual deployment off Long Island.
And they’ll still work together on onshore facilities related to Sunrise Wind and other regional projects, according to Eversource Energy President and CEO Joseph Nolan.
“We’re proud of the work we have already accomplished for Sunrise Wind,” Nolan said Wednesday. “We look forward to continuing our leadership position building onshore interconnection systems for offshore wind projects in the Northeast.”
