Orsted back in business in New York with Sunrise offshore wind green light

The US Department of the Interior (DoI) on Tuesday greenlit Orsted’s 920MW Sunrise Wind off New York, with the global developer swiftly following with a final investment decision on the project.

The “administration continues to make historic progress in developing the American offshore wind industry, which is paving the way for good-paying union jobs in manufacturing, shipbuilding and construction," said Interior Secretary Deb Haaland.

US offshore energy regulator Bureau of Ocean Energy Management (BOEM) under DoI issued the project’s record of decision (ROD), marking the end of its environmental review and allowing it to begin construction.

Its construction and operations plan (COP) approval is expected later this year.

“BOEM and our partners remain focused on implementing the Biden-Harris administration's vision of approving 30GW of offshore wind energy capacity by 2030,” said BOEM director Elizabeth Klein.

Sector struggles

US offshore wind has gained momentum recently following a devastating 2023 that saw half of all contracted capacity cancelled amid spiralling inflation and interest rates.

Activity has resumed as states show willingness to pay more for capacity as they scramble to meet looming climate targets and some 9.4GW has been procured since last October.

Sunrise, located 30 miles (48 km) east of Montauk, Long Island, was initially contracted by the New York State Energy Research and Development Authority (Nyserda) in 2019 at a levelised price of $83.3/MWh in 2018 dollars, which its owners said was no longer viable in the post-Covid economy.

The award remains provisional as the JV negotiates a final 25-year offshore renewable energy credit (OREC) contract with Nyserda, the agency charged with managing the state's energy transition.

An OREC represents the energy attributes of a single MWh of offshore wind power, according to Nyserda.

The project approval demonstrates “New York’s leadership in building the US offshore wind industry,” said Nyserda CEO Doreen Harris.

New York has 5.8GW of capacity under contract towards its mandated 9GW of operational offshore wind by 2035.

Sunrise is expected to power 600,000 homes while generating $700m of investment into New York’s economy and 800 jobs.

The approval and final investment decision will allow Orsted to “continue to create hundreds of local union jobs and stand up a vibrant supply chain,” said David Hardy, CEO of Region Americas.

The Sunrise approval “marks a significant step forward for US offshore wind deployment,” said Anne Reynolds, vice president for offshore wind for trade group American Clean Power Association.

“BOEM's approval of offshore wind projects is crucial for delivering more clean, renewable energy and is a critical step toward New York reaching a carbon-free electrical grid by 2040,” she added.

Liz Burdock, CEO of offshore wind trade group Oceantic Network, said it has “identified more than 60 companies that have contributed to the project, and dozens are expected as this next phase of construction begins.”

The Sunrise approval follows installation and full powering of the JV’s 132MW South Fork array, the first fully constructed project in the US.

South Fork is undergoing testing towards full commercial operations expected next year.

Orsted-Eversource split

The Orsted-Eversource JV that brought three of the first US commercial arrays to market – South Fork, Sunrise, and the 704MW Revolution Wind array split between Connecticut and Rhode Island – is set to be dissolved.

Eversource will remain contracted to lead the project’s onshore construction.

The project will employ 84 Siemens Gamesa 11MW turbines marshalled out of State Pier in Connecticut, also the staging site of South Fork and Revolution.