8-K: Eversource's Sunrise Wind Project Selected in New York's Latest Offshore Wind Solicitation

Eversource Energy's Sunrise Wind project has been selected in New York's latest offshore wind solicitation, and the company will proceed with the sale of its 50% stake to rsted while remaining involved in onshore construction.

Summary

• Eversource Energy and rsted's Sunrise Wind project has been selected in New York's latest offshore wind solicitation, known as New York 4.
• The project is expected to be the largest U.S. offshore wind farm upon completion in 2026.
• Eversource will sell its 50% interest in the project to rsted but will remain contracted to lead the onshore construction.
• The sale is expected to be completed later this year, subject to regulatory approvals.
• Eversource will no longer have risk exposure related to Sunrise Wind, including abandonment costs, after the sale.
• The project is awaiting the signing of an OREC contract with NYSERDA, finalization of acquisition agreements, and receipt of federal permits.
• The project's design has been reviewed and accepted by all relevant state agencies, and major supplier and project labor agreements are secured.
• Construction is scheduled to begin after receiving federal permits this summer and a final investment decision by rsted in the second quarter of 2024.

Sentiment

Score: 8

Explanation: The document conveys a positive outlook with the project's selection and the planned sale of Eversource's stake, indicating a successful step forward for the company and the project.

Positives

• The selection of the Sunrise Wind project in New York's solicitation is a positive step for the project's development.
• Eversource will eliminate risk exposure related to the project after the sale of its stake.
• The project is expected to create hundreds of local union jobs.
• The project will contribute to New York's clean energy goals.
• Eversource will continue to play a role in the project's onshore construction.
• The project has secured all major supplier and project labor agreements.

Negatives

• The sale of Eversource's 50% stake indicates a reduction in their long-term involvement in the project.
• The project is still subject to regulatory approvals and the signing of an OREC contract.

Risks

• The sale of Eversource's stake is subject to customary regulatory approvals.
• The project is dependent on the signing of an OREC contract with NYSERDA.
• The project requires the receipt of federal permits before construction can begin.
• The project is subject to a final investment decision by rsted.
• There are risks associated with the variability in projected construction costs.
• There is a risk of deterioration of market conditions in the offshore wind industry.
• The project may not commence operation as scheduled or within budget.

Future Outlook

Eversource expects to complete the sale of its 50% interest in Sunrise Wind to rsted later this year, subject to regulatory approvals. The project is scheduled to be operational in 2026.

Management Comments

• Eversource Chairman, President and Chief Executive Officer Joe Nolan stated that they are grateful for the Hochul Administration's support and look forward to their continued role in making the project a reality.
• Joe Nolan also mentioned that the project will deliver significant new investments to New York State, including the creation of hundreds of local union jobs.

Industry Context

This announcement highlights the ongoing development of offshore wind energy projects in the U.S. and the increasing involvement of major energy companies in this sector. The selection of the Sunrise Wind project in New York's solicitation is a positive sign for the growth of the offshore wind industry.

Comparison to Industry Standards

• The Sunrise Wind project, upon completion, is expected to be the largest U.S. offshore wind farm, which would place it at the forefront of the industry.
• Other major offshore wind projects in the US include Vineyard Wind and South Fork Wind, but Sunrise Wind is expected to be larger.
• The involvement of both Eversource and rsted, major players in the energy sector, indicates a strong commitment to the project's success.
• The project's progress is in line with the broader trend of increasing investment in renewable energy projects globally.

Stakeholder Impact

• Shareholders will benefit from the reduced risk exposure and the potential for future revenue from the project.
• Employees will be involved in the onshore construction of the project.
• Customers will benefit from the increased availability of clean energy.
• Suppliers will be involved in the project's construction and operation.
• The project will create hundreds of local union jobs.

Next Steps

• Finalizing agreements with NYSERDA on the OREC contract.
• Finalizing acquisition agreements for the sale of Eversource's stake.
• Receiving the federal construction and operations plan (COP).
• Receiving relevant regulatory approvals.
• rsted making a final investment decision in the second quarter of 2024.
• Beginning full scope of construction after receiving federal permits this summer.

Key Dates

Keywords

offshore wind, renewable energy, Sunrise Wind, Eversource, rsted, New York, NYSERDA, construction, energy, sale, OREC