PSEG, Ørsted to enter negotiations; NYSERDA finalizes contracts for offshore wind projects

In other news, joint venture partners Eversource and Ørsted late last month announced the submission of their Constitution Wind project bid in response to Connecticut’s request for proposals (RFP) for offshore wind energy generation

Public Service Enterprise Group (PSEG) and Ørsted on Oct. 29 said that they will enter into exclusive negotiations for PSEG to potentially become an equity investor in one of Ørsted’s offshore wind projects, noting that subject to negotiations toward a joint venture agreement, advanced due diligence, and any required regulatory approvals, PSEG would acquire 25% of the 1,100-MW Ocean Wind offshore wind project.
The project is expected to be commissioned in 2024, subject to permitting and final investment decision, the statement added.
Thomas Brostrøm, president of Ørsted North America and CEO of Ørsted U.S. Offshore Wind, said in the statement: “Ørsted’s experience in the offshore wind industry has taught us the importance of strong partnerships. Given PSEG’s track record for success and history providing energy solutions for communities across the Mid-Atlantic region, we are thrilled at the prospect of having them join the Ocean Wind project.”
PSEG Power President and Chief Operating Officer Ralph LaRossa said in the statement, “We are pleased about the opportunity to explore a partnership with Ørsted, a world leader in offshore wind development, and help New Jersey achieve its goal of carbon free generation by 2050.”
According to Ocean Wind’s website, the project will be located 15 miles off the coast of Atlantic City.
In other Ørsted-related news, New York Gov. Andrew Cuomo on Oct. 23 announced that the New York State Energy Research and Development Authority (NYSERDA) has finalized contracts with Equinor Wind US LLC for its 816-MW Empire Wind Project and Sunrise Wind LLC, which is a joint venture of Ørsted A/S and Eversource Energy, for its 880-MW Sunrise Wind Project to deliver renewable energy to New Yorkers.
Cuomo’s statement noted that NYSERDA concurrently submitted its “Launching New York’s Offshore Wind Industry: Phase 1 Report” to the New York State Department of Public Service, documenting the results of the state’s first large-scale offshore wind solicitation with a combined total capacity of nearly 1,700 MW.
The statement noted that the report’s key findings include:

  • New York’s first procurement garnered the most competitive market response to date among all U.S. state offshore wind solicitations, with four developers submitting 18 proposals
  • The Empire Wind and Sunrise Wind project have an average all-in development cost of $83.36 per MWh (2018 dollars), with an expected average OREC cost of $25.14 per MWh. The average bill impact for a residential customer will be about 73 cents per month
  • The contracts utilize an innovative Index OREC contracting structure where payments rise and fall inversely to a composite average of New York’s energy and capacity market prices markets, which do not reflect actual project revenues

The statement noted that NYSERDA will host an Offshore Wind Technical and Training Workshop on Long Island on Nov. 15.
Lastly, in a late September statement, joint venture partners Eversource and Ørsted announced the submission of their Constitution Wind project bid in response to Connecticut’s request for proposals (RFP) for offshore wind energy generation, with Constitution Wind including several project proposals.
Among other things, the statement noted that Constitution Wind is a proposed offshore wind project – in development since 2015 – located 65 miles off the coast of New London, Conn., that will have the capacity to power up to half a million homes.