June 6, 2024 — New York State finalized new power contracts for two offshore wind farms, Empire Wind 1 and Sunrise Wind, which had previously been placed in jeopardy when their developers said that rising costs had made the projects uneconomical for development. The signing of the new contracts puts the two mature projects back on track and helps to jumpstart New York State’s offshore wind sector.
Empire Wind 1 is a planned 810-megawatt project to be developed by Equinor 15 miles south of New York, while Sunrise Wind is a planned 924-megawatt project to be 30 miles to the east in a joint venture between Ørsted and Eversource. Eversource however has agreed to sell its interests to Ørsted. Both projects were originally awarded by NYSERDA in 2019 as part of the state’s first offshore wind solicitation. The original contracts set the strike price at approximately $118 per megawatt-hour for Empire Wind 1 and $110 for Sunrise Wind.
The projects had sought to renegotiate their contracts in 2023 but the regulator New York State Energy Research and Development Authority (NYSERDA) refused. In a hastily arranged fourth solicitation, New York reopened the wind for the projects on the condition cancel their existing contracts and rebid, but they were ultimately selected. New York Governor Kathy Hochul reports the weighted average all-in development cost of the contracted offshore wind projects over the life of the contracts is now $150.15 per megawatt-hour, which she asserts is on par with the latest market prices. It is however still below the $160 that the developers had asked for last year in the negotiations for Empire Wind 1.