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Private equity wades deeper into US offshore wind investments

March 7, 2024 — Challenging economics faced by later-stage US offshore wind projects struggling to get across the finish line are not deterring private equity firms from investing in various parts of the value chain.

From lease sales and port logistics to the projects themselves, some of the largest alternative asset managers are leaning into demand for infrastructure supported by federal tax credits and the Biden administration’s goal of 30 GW of offshore wind energy capacity by 2030 and an additional goal of 15 GW of floating offshore wind energy capacity by 2035.

Global Infrastructure Management LLC announced a deal in mid-February to take over Eversource Energy’s 50% interest in two of the utility company’s joint offshore wind farms with Ørsted A/S for $1.1 billion in cash. The following week, Dominion Energy Inc. saw its stock pop after announcing its own deal to unload a 50% stake in the 2,587-MW Coastal Virginia Offshore Wind project to Stonepeak Partners LP, with an expectation of $3 billion in proceeds for the utility upon close.

Due to high interest rates, cost inflation and supply chain clogs, Eversource had been forced to take a billion-dollar writedown on its offshore wind portfolio. Global Infrastructure Management will acquire the utility’s interest in the 132-MW South Fork Wind and 700-MW Revolution Wind projects, while Ørsted is moving to take complete ownership of the 924-MW Sunrise Wind project.

“Private equity does well when some of the initial development work has already been done and then they come in and fund it across the finish line,” Norton Rose Fulbright attorney Becky Diffen, who focuses on renewables project development, said in an interview.

Read the full article at S&P Global

Amid negotiations, R.I. fishing industry remains concerned over offshore wind impact, compensation

May 7, 2021 — What is the price of loss of livelihood?

This question is at the center of negotiations between local fishing industry representatives and offshore wind developers. And despite recent efforts to strike a better deal, some local fishermen say no number is high enough to justify the devastation they believe the projects will create for their jobs and industry.

The R.I. Coastal Resources Management Council at the urging of Gov. Daniel J. McKee delayed its approval of the South Fork Wind Farm to give developers Orsted A/S and Eversource Energy more time to reach an agreement with the fishing industry, the Associated Press has reported.

The CRMC through its Ocean Special Area Management Plan gets a say in the federal certification process for wind farm projects within a certain distance of the state coastline. Compensation is intended to offset losses from the construction and operation of the projects to the fishing industry.

The payouts help Rhode Island and Massachusetts fishermen, but there are no such benefits for fishermen in other states, even though many also fish in these areas. Other states also get no say in the federal approval process, unlike Rhode Island.

“Rhode Island holds the keys to the kingdom,” said Bonnie Brady, executive director for the Long Island Commercial Fishing Association.

Read the full story at the Providence Business News

Revolution Wind project moves forward with start to federal permitting review

April 30, 2021 — Plans to bring 400 megawatts of wind power to Rhode Island are advancing, with the federal agency in charge of issuing the project permits on Thursday announcing the start to its review process.

The U.S. Department of the Interior’s Bureau of Ocean Energy Management in a statement said it will begin its formal review and decision on the 100-turbine Revolution Wind project proposed for federal waters off the coast of Block Island. The process begins with a public comment period and review of the project for its impact on wildlife, fishing and boating industries and other economic and environmental factors before the agency issues a final decision.

International renewable energy developer Orsted A/S, which jointly proposed the project with the utility company Eversource Energy, previously announced its original 2023 completion date would likely be delayed due to uncertainty in the federal permitting process under the previous presidential administration.

With BOEM’s announcement Thursday, the company will “soon be in a position to better refine the project’s timeline,” Orsted spokeswoman Meaghan Wims said in an email on Thursday.

In a statement, the company called the federal agency notice  “the most significant permitting milestone to date.”

Read the full story at Providence Business News

Tricia Jedele: Offshore wind rush is irresponsible

May 21, 2018 — In an April opinion piece, Interior Secretary Ryan Zinke wrote that “affordable, reliable, and abundant American energy drives domestic jobs and prosperity.” If by “drives domestic jobs and prosperity” Zinke meant “threatens the very existence of New England fishermen,” then the East Farm Commercial Fisheries Center of Rhode Island (which represents Rhode Island commercial fishermen) would agree.

Right now, Zinke’s Bureau of Ocean Energy Management is reviewing a construction and operation plan submitted by Vineyard Wind. Vineyard Wind is a project company owned by Copenhagen Infrastructure Partners and Avangrid Renewables, a subsidiary of Iberdrola, a company based in the industrial port city of Bilbao, Spain. These companies plan to install a massive offshore wind project in the waters south of Martha’s Vineyard and Nantucket.  In the first phase of the project alone, according to the plan, Vineyard Wind will install between 88 and 106 wind turbine generators, up to four electrical service platforms, 156.4 nautical miles of cable, and up to three offshore export cables that are each 122.5 nautical miles long. And this is just the first project.

There are two other project companies also vying for state contracts and state and federal approvals. Deepwater Wind’s Revolution Wind could be built off the Massachusetts’ coast at various sizes up to 400 megawatts in its first phase.  Bay State Wind, a 50-50 joint venture between Ørsted (a company based in Denmark) and Eversource Energy, is a proposed offshore wind project located 25 miles off the Massachusetts’ coast and 15 miles off the coast of Martha’s Vineyard with the potential to build up to 2,000 megawatts of wind power in the area.  Combined and fully developed, these projects could install more than 500 turbines in the waters off Massachusetts and Rhode Island.

Read the full story at Commonwealth Magazine

 

Massachusetts Punts on Big Offshore Wind Decision

April 26, 2018 — Massachusetts has opted to delay by at least one month its much-anticipated choice of a developer to build a 400-MW to 800-MW offshore wind farm—citing the unexpected complexity of bids received, complications of three extreme storms in March and an outside jurisdictional decision affecting the state. The state’s three utilities on April 23 notified officials that the May 23 selection will not affect the July 2 contract execution date, attorneys said in a letter.

Utilities National Grid, Eversource Energy and UNITIL said the three developer proposals received in response to a solicitation last June actually were made up of about 20 separate bids—some with multiple pricing and other options, including several complex scenarios that require detailed and demanding analysis. Baystate Wind submitted two bids with eight project variations. Vineyard Wind proposed two 400-MW wind farms combined with 1,600 MW of expandable transmission and a plan to accelerate supply chain development. Deepwater Wind proposed adding offshore wind incrementally to await falling costs and building grid-scale pumped storage and expandable transmission. It said the incremental addition could save ratepayers from $300 million to $600 million.

Read the full story at ENR

 

New England Council: Massachusetts Offshore Wind Public Open Houses – November 27-30, 2017

November 22, 2017 — The following was released by the New England Fishery Management Council:

The following public open houses may be of interest to the New England Fishery Management Council’s stakeholders who are following offshore wind developments.  Four events are scheduled for the week following Thanksgiving, all in Massachusetts.  Here are the details.

WHAT’S GOING ON:  Bay State Wind LLC is proposing to develop a new offshore wind farm 15-to-25 miles south of Martha’s Vineyard in the area known as the Bureau of Ocean Energy Management (BOEM) Lease OCS-A 0500.

WHO’S INVOLVED:  The project is being developed as a 50/50 joint venture between Orstead (formerly DONG Energy) and Eversource Energy, which together make up Bay State Wind.

WHEN AND WHERE ARE THE OPEN HOUSES:  The four public open houses will be held on the following dates in the following locations:

  • Monday, November 27 – Somerset Berkley Regional High School, 625 County Street, Somerset, MA, 6 p.m. to 8 p.m.
  • Tuesday, November 28 – The New Bedford Whaling Museum, 18 Johnny Cake Hill, New Bedford, MA, 5 p.m. to 8 p.m.
  • Wednesday, November 29 – The Barn Bowl & Bistro, 13 Uncas Avenue, Oak Bluffs, MA, 5 p.m. to 8 p.m.
  • Thursday, November 30 – The Sea Crest Beach Hotel, 350 Quaker Road, Falmouth, MA, 5 p.m. to 8 p.m.

PROJECT DETAILS:  The developers stated, “In December 2017, Bay State Wind will participate in the first state-led procurement of offshore wind power in the United States in response to a solicitation led by the Massachusetts Department of Energy Resources and the Electric Distribution Companies.” More information about the initiative is available at http://baystatewind.com/About-bay-state-wind#0.

QUESTIONS:  For more information contact Bay State Wind Fishery Liaison Officer John Williamson at (207) 939-7055, john@seakeeper.net.