Equinor and Ørsted sign new power deals for New York offshore wind farms
Equinor and Ørsted sign new power deals for New York offshore wind farms | Windpower Monthly
New York state and offshore wind developers Equinor and Ørsted have finalised offtake contracts for the 810MW Empire Wind 1 and 924MW Sunrise Wind projects.
The state had announced preliminary approval for the projects in February.
Once in operation in 2026, they will be the largest power generation projects in New York state in over 35 years.
The projects have a troubled history.
The Equinor and Ørsted-Eversource projects had been resubmitted to the state’s fourth offshore wind auction after withdrawing from their previous contracts, when the developers cited inflation and supply chain constraints for making the projects no longer economically viable.
New York has a goal of 9GW of offshore wind capacity by 2035.
The weighted average all-in development cost of the contracted offshore wind projects over the life of the contracts is $150.15/MWh which is on-par with the latest market prices, the state added. Equinor and Ørsted had initially won power deals for their wind farms in 2019.
Related Knowledge Center: Offshore wind energy
Over the next decade, U.S. offshore wind power is expected to grow from a single 30-megawatt wind farm off Rhode Island to more than 2,000 MW of capacity along the Atlantic Seaboard. There are contracts for wind power off the coasts of Massachusetts, Connecticut, New York, Maryland, New Jersey, Rhode Island, and Virginia.
The National Renewable Energy Laboratory has estimated the United States has over 4,000 gigawatts (GW) of offshore wind potential, enough to power the country four times over.
The growth in part being spurred by state solicitations, including in New York, where then-Gov. Andrew Cuomo (D) set a commitment of 9,000 MW of offshore wind by 2035, and in Connecticut, where in June 2021, Gov. Ned Lamont (D) signed legislation authorizing the construction of 2,000 MW of offshore wind by 2030.
The offshore development is also being driven by an investment tax credit set to end in December 2019 and is equal to 12 percent of expenditures. U.S. Sens. Susan Collins (R-Maine) and Tom Carper (D-Del.) have introduced a bill to extend the tax credit for up to eight years.
The Interior Department has held eight competitive lease sales that resulted in 15 offshore wind leases over 1.7 million acres that has the potential for 21 GW of capacity. In February 2022, the Bureau of Ocean Energy Management completed a bidding process that realized $4.37 billion for 488,000 acres across six lease areas in federal waters off New York and New Jersey.
Projects have also been proposed off the Southeast coast, off California and Hawaii, and for the Great Lakes.