Eversource to exit US offshore wind JV with Ørsted in USD-625m deal

May 26 (Renewables Now) - Denmark’s Ørsted A/S (CPH:ORSTED) has struck a deal to buy out its JV partner Eversource Energy’s (NYSE:ES) 50% stake in an uncontracted federal offshore wind lease area in the US Northeast, as well as some key operational assets, in a deal worth USD 625 million (EUR 581.3m).

The agreement concerns Lease Area OCS-A 500 (Lease 500), which totals 187,000 acres (75,7000 ha) and offers the potential for accommodating up to 4 GW of offshore turbine capacity, Ørsted said on Thursday.

Currently in the early stages of development, the area covers three projects – the 132-MW South Fork Wind and 920-MW Sunrise Wind off New York and the 704-MW Revolution Wind in waters between Connecticut and Rhode Island. The acreage is located 25 miles off the coast of Southern New England and is sited near Ørsted’s existing projects, which will create construction and operational efficiencies, the Danish group said.

Under the arrangement, Eversource will provide tax equity for South Fork Wind.

In addition to the seabed area, Ørsted will acquire contracts and leases for strategic port facilities and other assets in the Northeast, including partnerships with three ports in Rhode Island and one in Connecticut. The deal will also see the Danish energy major take full ownership of an operations and maintenance hub in East Setauket, New York, plus a charter agreement for what will be the first American-built offshore wind service operations vessel.

“The combination of the seabed and additional components in this agreement further establish a major hub in the Northeast for our activities and future opportunities,” said David Hardy, CEO Americas at Ørsted.

The deal is subject to regulatory clearance and is expected to be finalised in the third quarter. After its closing, Eversource will support the onshore activities for the three projects through construction.

Ørsted and Eversource set up their JV six years ago.

(USD 1.0 = EUR 0.930)