Wind

Eversource finalises sale to Orsted of half-stake in New York-bound Sunrise

Announcement another step on New England utility's exit from generation side of sector following sales of South Fork and Revolution

Joe Nolan, Eversource CEO.
Joe Nolan, Eversource CEO.Foto: Eversource Energy via Twitter
US Offshore Wind Editor, Recharge
New England utility Eversource confirmed it has “finalised definitive documents” on its previously announced agreement to sell its 50% stake in the 920MW Sunrise Wind farm to partner Orsted, with the transaction set to be completed later this year.
We have “executed the purchase and sales agreement that formalises the deal terms of the sale, including the on-going contractual onshore work that we will provide as a contractor to Sunrise,” an Eversource representative told Recharge.

“We’re proud of the work we have already accomplished for Sunrise Wind and look forward to assisting Orsted and the State of New York in advancing this important clean energy project through our continued onshore support,” said Joe Nolan, Eversource CEO.

The announcement is further progress on the energy firm’s exit from offshore wind generation following its agreement to sell its stakes in the 132MW South Fork and 704MW Revolution projects to Blackrock-owned Global Infrastructure Partner (GIP) for $1.1bn.
Eversource bought its 50% stakes in Orsted’s Revolution, South Fork, and Sunrise projects in 2019 for $225m in what was seen as a risky bet at the time.
That risk caught up with Eversource last year, and the utility announced an expected fourth quarter impairment of $1.4bn-$1.6bn due to the three projects in January.

The Sunrise sale was contingent on the project being re-contracted in the hastily arranged New York round 4 procurement following two years of surging inflation that left its 2019 offtake contracts no longer viable in current market conditions.

Sunrise was duly selected in the round ending in February for an estimated $150/MWh, a significant uplift over its original price of $83.3 in 2018 dollars.
The project was recently issued its record of decision (ROD) from federal offshore energy regulator Bureau of Ocean Energy Management in March, a major milestone that sets it up for full approval later this year.

The joint venture partners simultaneously announced final investment decision, confirming the project would go forward.

Eversource remains committed to leading onshore construction of the project but will no longer “have any ongoing ownership interest in the project, nor any ongoing financial obligations associated with project costs,” the utility said.

The deal is subject to regulatory approval and execution of a contract with the New York State Energy Research and Development Authority (Nyserda).

The Eversource representative added that “progress towards the closing of the sale of South Fork Wind and Revolution Wind remains ongoing, as we await the approval by state and federal agencies, among other closing conditions.”

Eversource expects to complete these deals “in the second half of the year”.

(Copyright)
Published 19 April 2024, 16:22Updated 19 April 2024, 16:22
AmericasUSEversourceOrstedSunrise Wind