BOSTON– September 7, 2023 – Ørsted, the U.S. leader in offshore wind energy, announced it has reached financial close of its acquisition of Eversource Energy’s 50 percent interest in the uncontracted federal offshore wind lease area previously owned jointly by the two companies. The U.S. Treasury Department’s Committee on Foreign Investment approved the acquisition on July 27. In addition to the seabed, which is in early-stage development, Ørsted and Eversource Energy have also executed an agreement for Ørsted’s acquisition of certain contracts and partnerships for key operational assets in the Northeast previously owned jointly by the two companies.
The $625 million acquisition demonstrates Ørsted’s leadership in offshore wind energy and demonstrates the company’s long-term commitment to building an American offshore wind industry, including a supply chain that creates jobs across the United States and drives innovation for the global market.
The lease area, which includes Lease Area OCS-A 500 (Lease 500), contains approximately 187,000 uncontracted acres of seabed for American offshore wind energy and has a potential capacity of up to 4 gigawatts. In connection with this transaction, Ørsted and Eversource Energy have also executed an agreement for Ørsted’s acquisition of certain contracts and leases for strategic port facilities and other assets previously owned jointly by the two companies. Ørsted will also take full ownership of partnerships with the Port of Providence, the Port of Davisville, and Quonset Point, all in Rhode Island, and with Connecticut's New London State Pier. Ørsted will also acquire ownership ofthe operations and maintenance hub in East Setauket, N.Y., and the charter agreement for the first American-built offshore wind service operations vessel, which is under construction at Edison Chouest’s facility in Houma, Louisiana, and is more than 50 percent complete.
Lease 500 is strategic to Ørsted’s U.S. offshore wind portfolio. In addition to its proximity to existing Ørsted projects, which creates construction and operational efficiencies, the site also offers shallow water depth and favorable wind speeds compared to other sites in the U.S. and globally. Located approximately 25 miles off the coast of Southern New England, the site can also serve key markets, including Massachusetts, Rhode Island, Connecticut and New York.
“Ørsted’s long-term commitment to building an American offshore wind industry is now further solidified with our full ownership of the Lease 500 site and several other strategic Northeast operational assets,” said David Hardy, Group EVP and CEO Americas at Ørsted. “This seabed area is one of the best offshore wind sites in the nation, capable of delivering up to 4 gigawatts of clean energy in proximity to four Northeast markets as well as several of our existing projects. We’ve proposed siting the Sunrise Wind 2 project for New York in this lease area, and we’re evaluating other opportunities including active offshore wind solicitations in the region. We’re well-positioned to build on our leadership role in the U.S. offshore wind industry with these strategic operational assets and lease area.”
Eversource announced last year it was reviewing its offshore wind energy portfolio and considering whether to sell related assets. In addition to selling its uncontracted seabed and other interests, Eversource determined that it is in the best long-term interest of the company to pursue the sale of its existing 50 percent interest in its three jointly owned contracted offshore wind projects (South Fork Wind, Revolution Wind and Sunrise Wind).
As part of the sale to Ørsted, Eversource will provide tax equity for the South Fork Wind project. Securing the tax equity arrangement is a critical milestone for South Fork Wind ahead of its plan to begin operations and deliver renewable energy later this year. Eversource is being engaged to provide services as an onshore construction manager to continue to support onshore scopes of all three projects through construction, ensuring the long-term continuity and success of the portfolio.
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