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Why Eversource might exit its offshore wind partnership with Ørsted

The Eversource board voted to conduct a strategic review of the energy giant's offshore wind interests, would could result in the partial or complete sale of its stake in a joint venture with Ørsted.
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Eversource could exit its joint venture to develop offshore wind projects with Ørsted amid record-setting lease auctions in the U.S.

The energy giant announced in its quarterly earnings report that it had launched a "strategic review" of the 50-50 partnership, which could result in the sale of some or all of its stake.

The company will analyze whether alternative investments would produce better value for shareholders.

Eversource CEO Joe Nolan noted the record-setting New York Bight lease auction as one of the reasons to conduct the strategic review of the company's offshore wind portfolio. Winning bids for the rights to develop six areas offshore New York and New Jersey totaled a combined $4.37 billion.

"Eversource remains committed to supporting offshore wind with advocacy, transmission investment solutions, and clean energy resource integration," Nolan said in a statement. "We have seen up close why Ørsted is unquestionably the world leader in engineering, building and operating offshore wind and have no doubt that the joint venture we launched five years ago will be a tremendous source of clean energy and economic development for the Northeast.”

Eversource expects to complete the review in 2022.

Funds generated from the sale of Eversource's stake in the partnership with Ørsted could be used to support regulated investments in strengthening and decarbonizing its energy and water delivery systems.

Proceeds could also be used for investments in advanced metering infrastructure and additional transmission investments to connect offshore wind projects.

The joint venture between Eversource and Ørsted includes the South Fork Wind, Revolution Wind, and Sunrise Wind projects with total capacity of 1,758 MW.

The partnership also has up to 175,000 acres of offshore wind area not allocated to a specific project 25 miles off the coast

Eversource will continue to provide oversight of the siting and construction of onshore elements of the three active projects, the company said. Just last month, Eversource and Ørsted signed the first helicopter contract to support U.S. offshore wind projects.

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