New York’s state government said Thursday it awarded provisional contracts to two proposed offshore wind projects totaling more than 1,700 MW: Empire Wind 1, developed by Equinor (EQNR), and Sunrise Wind, developed by Ørsted (OTCPK:DNNGY) and Eversource Energy (NYSE:ES).
The solicitation by the New York State Energy Research and Development Authority allowed companies to exit old contracts and re-offer projects at higher prices, following warnings from offshore wind developers that proposed projects cannot be built profitably due to soaring construction costs, higher interest rates and supply chain snags.
Eversource (ES), which has been seeking to exit its offshore wind investments, said it will move forward with its agreement to sell its 50% Sunrise Wind stake to Ørsted (OTCPK:DNNGY) while remaining contracted to lead onshore construction.
“Upon the completion of a successful sale, Eversource no longer expects to have any risk exposure related to Sunrise Wind, including abandonment costs that were assumed in its impairment assessment,” the company said.
The projects will be New York’s largest power generation projects in more than 35 years once they enter operation in 2026, and will continue progress towards achievement of the state’s goal to develop 9K MW of offshore wind energy by 2035.