Eversource to Sell Offshore Wind Stake for $625M

Block Island Wind Farm (Credit: CT Examiner/Clingman)


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Eversource will sell its stake in offshore wind lease areas off the coast of Massachusetts for $625 million to its wind partner Ørsted, but the company told investors recently that it plans to write off about $220 to $280 million from its offshore wind assets when it completes the sale of its stake in their three jointly owned wind projects by the end of June.

Eversource has been looking to sell its stake in the 50-50 offshore wind partnership with Danish energy giant Ørsted since last May, when Eversource CEO Joe Nolan announced it was looking to cash in on its offshore wind holdings to pay off company debt and focus on connecting upcoming wind projects to the onshore electric grid.

The sale will leave Ørsted as the sole owner of about 187,000 acres nearly 25 miles off the south coast of Massachusetts that can potentially hold up to 4 gigawatts of offshore wind projects.

Eversource, the parent company of electric, water and gas companies in Connecticut, New Hampshire and Massachusetts, said it will use the cash proceeds from the sale to pay down debt it acquired in developing the partnership with Ørsted – which was about $2.16 billion at the end of March.

The company said in a release that it expects its second-quarter earnings report to include an “impairment charge” between $220 million and $280 million based on the sale of the lease area and anticipated sale price of the projects – meaning the sale price is expected to be less than what the company has valued them.

The release said the “impairment charge” won’t impact Eversource utility customers. 

Eversource said the buyer of its stake in those three offshore wind projects – the 704 megawatt Revolution, 880 MW Sunrise and 130 MW South Fork Wind – is still to be determined, and should be announced by the end of June. 

Ørsted will also take over Eversource’s share of their lease in the New London State Pier, from where the companies are set to start staging turbines for South Fork Wind next month. The two companies have so far put $75 million toward the pier’s reconstruction to support heavy turbines, the total cost of which is expected to increase from $255.5 million.

And Ørsted said it would take over the contracts and leases it holds with Eversource at other ports. That includes Providence and Quonset Point, Rhode Island, where they plan to set up a factory to build foundations for offshore wind turbines and an offshore wind hub at Providence Port.

Nolan said the company is still “fully committed to being a catalyst in the region’s clean energy transition,” as its regulated utilities in New England will build many of the facilities to connect offshore wind generation to the region’s electric grid.

“We share the same goals as the states in which we operate when it comes to building the clean energy delivery systems of the future,” Nolan said in the release.

Ørsted CEO Americas David Hardy said the agreement will help the company continue to establish a major offshore wind hub in the Northeast.

“This acquisition further demonstrates our long-term commitment to building an American offshore wind energy industry and the value creation opportunities we see in the U.S. market, Hardy said.

This story has been updated