Eversource Energy Announces Agreement to Sell Interest in Uncommitted Offshore Lease Area
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Eversource has agreed to sell its 50 percent interest in a currently uncommitted lease area of approximately 175,000 developable acres located 25 miles off the south coast of
Massachusetts to Ørsted for$625 million - Eversource has entered into a binding letter of intent with Ørsted to use a portion of the proceeds from the lease area sale to provide tax equity for the South Fork Wind project through a new tax equity ownership interest. Eversource will recover this investment primarily in the form of investment tax credits that will be received around the time of the project’s commercial operations date. Construction of South Fork commenced in early 2022, with commercial operation expected in late 2023. Eversource’s tax equity investment in South Fork Wind is also expected to close in the third quarter.
- Eversource has also determined that it is in the best long-term interest of the company to advance the sale of its existing 50 percent interest in its three jointly owned contracted offshore wind projects (South Fork Wind, Revolution Wind, and Sunrise Wind) with a total capacity of 1,758 MW. This process continues to progress and Eversource anticipates an announcement by the end of June.
“We have had the pleasure of working alongside Ørsted for more than six years and have experienced firsthand their expertise and global leadership in the offshore wind sector. We continue to expect that offshore wind projects built in our partnership’s lease area, including the three now under development, will play a critical role in decarbonizing the generation mix of Southern New England and New York,” said Joe Nolan, Eversource’s president, chief executive officer, and chairman. “While we are pursuing an exit of the unregulated offshore wind business, Eversource is fully committed to being a catalyst to the region’s clean energy transition, with our regulated companies building many of the facilities that will enable more than 9,000 megawatts of offshore wind generation to reach the homes and businesses of Southern New England. We share the same goals as the states in which we operate when it comes to building the clean energy delivery systems of the future.”
As a condition to close, the lease sale transaction will require approval of The Committee on Foreign Investment in
“I want to thank Eversource for our six-year partnership and for their expertise that has strategically advanced the onshore scopes of our three projects, which will deliver renewable energy to
Eversource cannot provide any assurances regarding the outcome of the sale process of its three contracted projects. As a result of multiple bids and indicative offers from interested parties, Eversource has evaluated its aggregate investment in the three projects, uncommitted lease area, and other related capitalized costs and believes that an other-than-temporary impairment exists. Eversource expects its second quarter 2023 results will include a non-recurring after-tax impairment charge currently estimated to range from
Also today, Eversource reaffirmed its full-year 2023, non-GAAP earnings projection of between
Eversource has engaged Goldman Sachs as its financial advisor to assist with the transactions and Ropes & Gray serves as its legal counsel.
Eversource Energy operates New England’s largest energy delivery system and serves approximately 4.4 million electric, natural gas and water utility customers in
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Other risk factors are detailed in Eversource Energy’s reports filed with the Securities and Exchange Commission (SEC). They are updated as necessary and available on Eversource Energy’s website at www.eversource.com and on the SEC’s website at www.sec.gov. All such factors are difficult to predict and contain uncertainties that may materially affect Eversource Energy’s actual results, many of which are beyond our control. You should not place undue reliance on the forward-looking statements, as each speaks only as of the date on which such statement is made, and, except as required by federal securities laws, Eversource Energy undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.
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INVESTOR:
Jeffrey R. Kotkin
(860) 665-5154
Robert S. Becker
(860) 665-3249
MEDIA:
Caroline Pretyman
617-424-2460
caroline.pretyman@eversource.com
Source: Eversource Energy
