Orsted signed an agreement to acquire a 100 percent equity interest in Rhode Island-based Deepwater Wind, a leading U.S. offshore wind developer, the Danish wind giant announced Monday.
The agreement was signed with the New York-based global investment and technology development firm D.E. Shaw Group at a purchase price of $510 million, according to a statement from the company.
“The two companies’ offshore wind assets and organizations will be merged into the leading U.S. offshore wind platform with the most comprehensive geographic coverage and the largest pipeline of development capacity,” it said.
With the combined organization and asset portfolio upon completion of the transaction, the new organization will be known as Orsted U.S. Offshore Wind, and will be able to deliver clean energy to the seven states on the U.S. East Coast that have already committed to build in total more than 10 gigawatts (GW) of offshore wind capacity by 2030, the statement added.
According to the press release, Deepwater Wind's portfolio has a total potential capacity of approx. 3.3 GW comprising the 30-megawatt Block Island, the only operational offshore wind farm in the U.S. plus three offshore wind development projects in Rhode Island, Connecticut, Maryland and New York. These assets total 810 megawatts (MW) of capacity with long-term revenue contracts in place or pending finalization.
The company has also an approximately 2.5 GW of offshore wind development potential across three well-sited BOEM (Bureau of Ocean Energy Management) lease areas in Massachusetts and Delaware. Of this 2.5 GW, 1.2 GW is developed through an equal joint venture with PSEG, a leading New Jersey utility.
Orsted's current U.S. offshore wind portfolio has a total capacity of approx. 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.
The portfolio also includes development rights for up to 3.5 GW at the Ocean Wind site off the coast of New Jersey. And in Virginia, Orsted will construct two 6 MW wind turbine positions for phase one of Dominion Energy's Coastal Virginia Offshore Wind Project. Orsted has exclusive rights with Dominion Energy for the potential development of up to 2 GW of offshore wind capacity.
Martin Neubert, CEO of Offshore Wind at Orsted, said: "With this transaction we're creating the number one offshore wind platform in North America, merging the best of two worlds: Deepwater Wind's longstanding expertise in originating, developing and permitting offshore wind projects in the U.S., and Orsted's unparalleled track-record in engineering, constructing, and operating large-scale offshore wind farms.
"Today’s announcement consolidates Orsted's position as the global market leader in offshore wind with a strong foothold across Europe, North America and Asia-Pacific."
Bryan R. Martin, managing director of D. E. Shaw & Co., said he is "truly proud" that offshore wind's global leader Orsted can now author the next chapter for Deepwater Wind. "Together - they’ll continue to make history," he added.
A local management team headed by Orsted U.S. Offshore Wind CEO Thomas Brostrom, Co-CEO Jeff Grybowski, President and CFO David Hang both from the Deepwater Wind team, and COO Claus Bojle Moller from the Orsted team will represent the new organization.
The transaction is subject to clearance by the U.S. competition authorities and is expected to close by the end of 2018.
Orsted, which entered the U.S renewables market in 2015, completed last week the acquisition of Lincoln Clean Energy , a leading U.S. developer of onshore wind farms. The acquisition was announced in August.
By Hale Turkes
Anadolu Agency
energy@aa.com.tr