New England’s Eversource Takes $225 Million Stake in Orsted Wind

The Danish power giant Orsted's Gode Wind site under construction in the North Sea. After taking over Deepwater Wind, it has now partnered with Eversource on two American projects. Orsted

In a sign of a maturing domestic offshore wind industry, Eversource, New England’s largest energy company, has acquired a 50-percent interest in two of the Danish energy giant Orsted’s proposed installations, including the 15-turbine South Fork Wind Farm, which is to be constructed approximately 35 miles off Montauk.

According to a statement issued on Friday, Eversource will pay approximately $225 million for a 50-percent stake in Orsted's South Fork Wind Farm and also its Revolution Wind projects, the latter to deliver power to Connecticut and Rhode Island, as well as a 257-square-mile federal lease area off the coasts of Massachusetts and Rhode Island in which they are to be situated.

The deal builds upon Bay State Wind, the two companies' existing partnership in a separate 300-square-mile tract adjacent to the federal lease area originally won by Deepwater Wind. Together, the companies say that the lease sites they jointly own could generate 4,000 megawatts of electricity.

The companies will mutually manage permit requirements for their projects and have pledged to honor planned local investments and agreements entered prior to the partnership.

Revolution Wind is a planned 700-megawatt wind farm to be sited approximately 15 miles south of Rhode Island. Orsted and Eversource aim for it to go online in 2023.

Additionally, the Orsted-Eversource partnership is participating in New York State's first offshore wind energy solicitation, through which the State Energy Research and Development Authority plans to procure 800 megawatts of offshore wind. Bids are due today, with awards expected in the spring.

"Over the last several years, the two teams have worked together very closely, and have established a joint project development team," Clint Plummer, Orsted U.S. Offshore Wind's head of market strategies and new projects, said of the Orsted-Eversource partnership.

"When Orsted acquired Deepwater Wind, it was logical to expand those resources and capabilities to the rest of the New England portfolio." Eversource, he said, is "another strong American energy company that wants to make investments in assets like these."

Mr. Plummer said that along with himself, Deepwater Wind officials including Jeff Grybowski, its chief executive, Aileen Kenney, a vice president, Julia Prince, its Montauk manager and fisheries liaison, and Jennifer Garvey, Long Island development manager, remain in important positions within the Orsted organization.

"The thing that has changed is we are now executing this project with a larger group of people, which gives us more capability, and with companies with significant balance sheets, which gives us significant resources," he said.

While the American offshore wind industry is experiencing a growth spurt, there are just five turbines in the nation's waters, those of the Block Island Wind Farm, which Deepwater Wind commissioned in December 2016.

"Our challenge now," Mr. Plummer said, "is less about how you construct these. It's around the type of work we are doing now in East Hampton: making a big global business, like offshore wind, fit into an American context and -- in many ways more importantly -- making it fit into the context of the local communities it's going to serve."