Danish offshore wind energy giant Ørsted has entered into an agreement to acquire the Rhode Island-based offshore wind developer behind the 30 megawatt (MW) Block Island offshore wind farm, Deepwater Wind, in a move set to be worth $510 million and which will result in the creation of a US offshore wind platform.
Ørsted announced on Monday that it had entered into an agreement with the D.E. Shaw Group to acquire a 100% equity interest in Deepwater Wind at a purchase price of $510 million. Ørsted and Deepwater Wind will merge their US-based offshore wind assets and organizations into what they believe will be “the leading US offshore wind platform with the most comprehensive geographic coverage and the largest pipeline of development capacity,” named Ørsted US Offshore Wind.
That “pipeline of development capacity” amounts to something close to 9 gigawatts (GW) when combining Deepwater Wind and Ørsted’s existing pipelines. More specifically, Deepwater Wind’s pipeline consists of approximately 3.3 GW made up of:
- The 30 MW Block Island offshore wind farm, the only operational offshore wind farm in the country
- Three offshore wind development projects in Rhode Island, Connecticut, Maryland, and New York totaling 810 MW of capacity with long-term revenue contracts in place or pending finalization.
- Approximately 2.5 GW of offshore wind development potential across three well-sited BOEM lease areas in Massachusetts and Delaware. Of these 2.5 GW, 1.2 GW is developed through an equal joint venture with PSEG, a leading New Jersey utility.
Ørsted’s current US offshore wind portfolio, on the other hand, has a total capacity of approximately 5.5 GW comprising:
- Development rights for up to 2 GW at the Bay State Wind site off the coast of Massachusetts owned in a joint venture with Eversource.
- Development rights for up to 3.5 GW at the Ocean Wind site off the coast of New Jersey.
- In Virginia, Ørsted will be constructing two 6 MW wind turbine positions for phase one of Dominion Energy’s Coastal Virginia Offshore Wind Project. Ørsted also has exclusive rights with Dominion Energy to discuss the potential development of up to 2 GW of offshore wind capacity.
“With this transaction we’re creating the number one offshore wind platform in North America, merging the best of two worlds,” crowed Martin Neubert, CEO of Offshore Wind at Ørsted. “Deepwater Wind’s longstanding expertise in originating, developing and permitting offshore wind projects in the US, and Ørsted’s unparalleled track-record in engineering, constructing, and operating large-scale offshore wind farms. Today’s announcement consolidates Ørsted’s position as the global market leader in offshore wind with a strong foothold across Europe, North America and Asia-Pacific.”
“Ørsted is one of the world’s great clean energy companies and real pioneers in the offshore wind sector,” added Jeffrey Grybowski, CEO of Deepwater Wind. “We could not be more pleased with this combination, which will bring together two great teams to realize an enormous clean energy resource for coastal populations in the US.”
The move was met with praise by those in the US focusing on the energy transition.
“This acquisition comes at a pivotal moment in America’s offshore wind story,” said Catherine Bowes, the National Wildlife Federation’s offshore wind program director. “We know responsibly developed offshore wind power offers a critical solution to climate change, and the first round of U.S projects must be sited and built with wildlife in mind. Deepwater WInd’s Block Island Wind Farm set a strong precedent with the development of America’s first offshore turbines, and we look forward to continuing to work with Orsted and all offshore wind companies to advance responsibly developed projects for America.”
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