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Researched by Industrial Info Resources (Sugar Land, Texas)--Late last week brought more movement in regard to sales agreements and partnerships in the turbulent U.S. offshore wind sector. Ørsted A/S (Fredericia, Denmark) canceled a power offtake contract with Maryland and announced plans to take over partner Eversource Energy's (NYSE:ES) (Hartford, Connecticut) share of the Sunrise Windfarm, while energy majors BP (NYSE:BP) (London, England) and Equinor (NYSE:EQNR) (Stavanger, Norway) dissolved their joint-venture partnerships for two U.S. offshore projects, each taking sole ownership of one.
Ørsted
In recent months, several companies developing wind projects in U.S. waters have exited or positioned themselves to renegotiate power offtake contracts made in previous years. In the time since many of these contracts were made, development costs and supply-chain issues have increased, pushing the price of these projects upward and making these former contracts unlucrative for wind developers.
Ørsted was feeling the pinch from a previous contract with Maryland for power from its Skipjack Windfarm, planned for waters off the Delmarva Peninsula. The project is planned to be built in two phases, with a smaller portion of turbines initially generating about 120 megawatts (MW) of power, followed by a larger installation, which would take the facility's total generating capacity to more than 900 MW.
Despite reneging on the contract, Ørsted says development of Skipjack will continue. "As we explore the best path forward for Skipjack Wind, we anticipate several opportunities and will evaluate each as it becomes available. We'll continue to advance Skipjack Wind's development milestones, including its construction and operations plan," said David Hardy, executive vice president and chief executive Americas at Ørsted. Subscribers can learn more by viewing the project reports on Skipjack 1 and Skipjack 2.
Increased costs have also caused Ørsted and partner Eversource to resubmit a revised proposal for their Sunrise Wind project in New York's fourth offshore wind solicitation, which was held Friday. Late last year, New York launched this accelerated solicitation that allows companies to exit old contracts and re-offer them at higher prices, which is the case with Sunrise.
However, should New York accept the companies' latest bid, Eversource's 50% stake in Sunrise will shift out of Eversource's hands, and the project will fall completely to Ørsted. Eversource has been looking to exit its offshore wind partnerships with Ørsted for some time. The winners of the current round of offshore wind solicitation in New York are expected to be announced in February. The Sunrise project would be built in waters off Long Island and would generate more than 800 MW. The project could potentially kick off this year, putting it on track for completion in 2026 or 2027. Subscribers can learn more by viewing the project report.
Another smaller Ørsted-Eversource offshore project is moving along at a brisk pace. The first turbine at the South Fork offshore windfarm was installed in November and began sending power to the grid in early December. Ørsted recently announced that more than half of the 12 Siemens-Gamesa turbines have been installed and are delivering power. At the present rate of construction, the 130-MW windfarm should be completed and generating full power within a matter of months. Subscribers can click here for more information.
Equinor & BP
Equinor and BP have been partnering on two U.S. offshore projects for a number of years but have now decided to part ways. The companies have been developing the Empire and Beacon wind projects, both of which have sales contracts in place with New York. Equinor will take full ownership of the Empire wind project, which has two planned stages of development, and like Ørsted, Equinor has resubmitted its sales proposal to New York for the first part of the development in the latest New York offshore wind solicitation.
Empire 1 would include 54 turbines, each rated at 15 MW, to achieve nameplate generation of 810 MW. Equinor did not resubmit a bid for the second part of the project, which would add a further 1,200 MW of generation through the addition of 80 turbines, saying it would bid this portion at a future date. Equinor says taking in the full stake in the Empire project would increase its capital spending in 2024 by about $1.2 billion, followed by an increase of $1.5 billion in 2025, before project financing. Subscribers can learn more by viewing the project reports on Empire 1 and Empire 2.
BP has taken full ownership of the previously jointly held Beacon offshore windfarm, planned for Massachusetts waters, but with contracts in place with other states. This development would also be constructed in two phases, with the first phase adding 1,230 MW and the second another 1,170 MW, bringing the windfarm's nameplate generation to 2,400 MW. In total, the combined projects are expected to utilize 240 turbines, each rated at 10 MW. Construction on the first portion of the project could begin next year, followed by the second portion in 2026. Both phases could eventually be online by 2028. Subscribers can learn more by viewing the project reports on the Beacon 1 and Beacon 2 developments.
Subscribers to Industrial Info's GMI Power Project Database can click here to view reports for all of the projects discussed in this article and click here to see the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
Ørsted
In recent months, several companies developing wind projects in U.S. waters have exited or positioned themselves to renegotiate power offtake contracts made in previous years. In the time since many of these contracts were made, development costs and supply-chain issues have increased, pushing the price of these projects upward and making these former contracts unlucrative for wind developers.
Ørsted was feeling the pinch from a previous contract with Maryland for power from its Skipjack Windfarm, planned for waters off the Delmarva Peninsula. The project is planned to be built in two phases, with a smaller portion of turbines initially generating about 120 megawatts (MW) of power, followed by a larger installation, which would take the facility's total generating capacity to more than 900 MW.
Despite reneging on the contract, Ørsted says development of Skipjack will continue. "As we explore the best path forward for Skipjack Wind, we anticipate several opportunities and will evaluate each as it becomes available. We'll continue to advance Skipjack Wind's development milestones, including its construction and operations plan," said David Hardy, executive vice president and chief executive Americas at Ørsted. Subscribers can learn more by viewing the project reports on Skipjack 1 and Skipjack 2.
Increased costs have also caused Ørsted and partner Eversource to resubmit a revised proposal for their Sunrise Wind project in New York's fourth offshore wind solicitation, which was held Friday. Late last year, New York launched this accelerated solicitation that allows companies to exit old contracts and re-offer them at higher prices, which is the case with Sunrise.
However, should New York accept the companies' latest bid, Eversource's 50% stake in Sunrise will shift out of Eversource's hands, and the project will fall completely to Ørsted. Eversource has been looking to exit its offshore wind partnerships with Ørsted for some time. The winners of the current round of offshore wind solicitation in New York are expected to be announced in February. The Sunrise project would be built in waters off Long Island and would generate more than 800 MW. The project could potentially kick off this year, putting it on track for completion in 2026 or 2027. Subscribers can learn more by viewing the project report.
Another smaller Ørsted-Eversource offshore project is moving along at a brisk pace. The first turbine at the South Fork offshore windfarm was installed in November and began sending power to the grid in early December. Ørsted recently announced that more than half of the 12 Siemens-Gamesa turbines have been installed and are delivering power. At the present rate of construction, the 130-MW windfarm should be completed and generating full power within a matter of months. Subscribers can click here for more information.
Equinor & BP
Equinor and BP have been partnering on two U.S. offshore projects for a number of years but have now decided to part ways. The companies have been developing the Empire and Beacon wind projects, both of which have sales contracts in place with New York. Equinor will take full ownership of the Empire wind project, which has two planned stages of development, and like Ørsted, Equinor has resubmitted its sales proposal to New York for the first part of the development in the latest New York offshore wind solicitation.
Empire 1 would include 54 turbines, each rated at 15 MW, to achieve nameplate generation of 810 MW. Equinor did not resubmit a bid for the second part of the project, which would add a further 1,200 MW of generation through the addition of 80 turbines, saying it would bid this portion at a future date. Equinor says taking in the full stake in the Empire project would increase its capital spending in 2024 by about $1.2 billion, followed by an increase of $1.5 billion in 2025, before project financing. Subscribers can learn more by viewing the project reports on Empire 1 and Empire 2.
BP has taken full ownership of the previously jointly held Beacon offshore windfarm, planned for Massachusetts waters, but with contracts in place with other states. This development would also be constructed in two phases, with the first phase adding 1,230 MW and the second another 1,170 MW, bringing the windfarm's nameplate generation to 2,400 MW. In total, the combined projects are expected to utilize 240 turbines, each rated at 10 MW. Construction on the first portion of the project could begin next year, followed by the second portion in 2026. Both phases could eventually be online by 2028. Subscribers can learn more by viewing the project reports on the Beacon 1 and Beacon 2 developments.
Subscribers to Industrial Info's GMI Power Project Database can click here to view reports for all of the projects discussed in this article and click here to see the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
