Eversource, the largest energy provider in New England, initiated a review Wednesday of its offshore wind ventures which have been touted by the Biden administration.
The company’s “strategic review” will examine its 50% stake in a multi-project joint offshore venture with global renewable energy powerhouse Ørsted, Eversource — which serves about 4 million customers in Massachusetts, Connecticut and New Hampshire — confirmed to investors Thursday. The multi-billion-dollar venture with Ørsted includes three offshore wind projects: the South Fork Wind and Sunrise Wind projects in New York and the Revolution Wind in Rhode Island.
“We are conducting a fulsome review of our interest in the joint venture with Ørsted to assess alternatives that will allow us to create shareholder value and continue building a leading clean energy company that is wholly supportive of our region’s climate change goals,” Eversource President and CEO Joe Nolan said in a statement Wednesday.
He added that the company would continue to support offshore wind development through “advocacy, transmission investment solutions and clean energy resource integration.” (RELATED: Weak Wind Power To Blame For European Energy Crisis, Greater Reliance On Fossil Fuels: REPORT)
Nolan said the energy utility’s review of its wind investments would conclude by the end of 2022, during an earnings call Thursday.
The review could lead to the sale of all or part of the company’s stake in the Ørsted venture and the proceeds of such a transaction would be invested in the company’s existing energy and water delivery systems, according to Eversource. The company is confident it will receive large offers to scoop up its stake given its lease value, Nolan added.
Today, I joined my colleagues, Governor Hochul and the Secretary of the Interior, Deb Haaland, to celebrate the start of construction of South Fork Wind, New York’s first offshore wind project. I’m proud to say that Long Island is an emerging trailblazer in renewable energy (1/2) pic.twitter.com/TXDMLIiUbl
— Fred W. Thiele, Jr. (@fred_thiele) February 11, 2022
“We see an opportunity to convert early, strategic investments in the wind industry to reinvest the proceeds in our core distribution, transmission, heating and land-based clean energy businesses – where we’ve identified an estimated $18B of initial investments in our 5-year capital plan – including utility-scale solar, EV charging infrastructure, and technologies to make our infrastructure smarter,” Eversource spokesperson Caroline Pretyman told the Daily Caller News Foundation in an email.
“Given the increased interest in offshore wind and the potential value of our lease areas, we have a responsibility to reevaluate our portfolio,” Pretyman continued.
The green energy industry has been rocked by surging commodity prices over the last several months, leading to rapidly declining profits for wind and solar manufacturers. The average price for green tech has increased 28.5% between 2021-2022 while the number of wind and solar project completions have plummeted 73% between 2019-2021.
Eversource and Ørsted celebrated the groundbreaking of the South Fork Wind project in East Hampton, New York, with Interior Secretary Deb Haaland and Democratic New York Gov. Kathy Hochul on Feb. 11. Both Haaland and Hochul touted the project as the future of renewable power generation in the U.S.
“America’s clean energy transition is not a dream for a distant future – it is happening right here and now,” Haaland said in a statement.
“Today as we break ground on New York’s first offshore wind project we are delivering on the promise of a cleaner, greener path forward that will benefit generations to come,” Hochul added.
Altogether, the three wind projects are expected to come online between 2023-2025 and have a total capacity of roughly 1,760 megawatts, Nolan said during Eversource’s 2021 year-end earnings call. Eversource has already invested more than $4.3 billion in the projects.
The venture’s expected capacity would be enough to power about 288,000 homes, according to one industry estimate. However, offshore wind only produces between 41-50% of its total capacity on an annual basis.
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