Powering New York With Offshore Wind

5 minute(s) Read

March 13, 2024

Daniel Foelber

Circular Economy & Conservation, Climate Targets, ESG Ratings, Wind & Solar

Equinor’s offshore wind project has been selected in New York’s fourth offshore wind solicitation. Known as Empire Wind, the 810-MW wind farm will power more than half a million New York homes. For context, that’s enough to power all of Staten Island or one-third of Manhattan.

Empire Wind will help the state move closer toward achieving its 2035 9-GW offshore wind target. Construction on the nearby South Brooklyn Marine Terminal (SBMT) is expected to begin this spring. SBMT will act as a hub for offshore wind operations and maintenance. Empire Wind is expected to enter service in 2026.

The project is located 15 miles (24 km) to 30 miles (48 km) southeast of Long Island over an 80,000-acre (32,375-ha) area, with water depths ranging from 75 to 135 ft. (23 to 41 m). Empire Wind 2 is expected to bring an additional 1.26 GW of offshore wind capacity, bringing the project’s total to 2.07 GW.

A rendering of the South Brooklyn Marine Terminal. (Image Courtesy Of Equinor)

Equinor was awarded the Empire Wind lease in 2017 and the Beacon Wind Lease in 2019. In 2020, BP farmed into a 50% share of both assets for US$1.1 billion. Equinor won its first offtake contract with New York for the first phase of Empire Wind in 2019 and the second phase in 2021.

Equinor is embracing ESG by investing in various local initiatives such as the Offshore Wind Innovation Hub and the Ecosystem Fund, which help New Yorkers get involved in the offshore wind industry.

Next Steps

Empire Wind 1 has already achieved several key state and federal permitting milestones, including its Article VII Certificate of Environmental Capability and Public Need from the New York Public Service Commission. On February 22, Empire Wind received the approval of its construction and operations plan (COP) from the Bureau of Ocean Energy Management. First submitted in 2020, the Empire Wind COP authorizes detailed plans for offshore and onshore construction and operations based on years of environmental reviews, input from outside experts, and extensive public feedback.

Empire Wind Lease Map (Image Courtesy Of Equinor)

Within Q2 2024, Equinor and NYSERDA are expected to execute an Offshore Wind Renewable Energy Certificate (OREC) purchase and sale agreement. Equinor plans to deliver a real base project return on the lower end of its 4% to 8% range due to macroeconomic factors. The company expects to reach a final investment decision by mid-year. Financial close and project financing terms are expected by the end of the year. Equinor said it plans to bring a partner onto the project to reduce ownership share and exposure.

Empire Wind Backstory

If you’ve been following US east coast wind projects for a while, you may recall that Equinor and BP had joint ventures in multiple projects. However, the downturn across the wind industry over the last few years has spurred strategic reshuffling.

In late January, Equinor and BP entered into a swap transaction that gives Equinor full ownership of Empire Wind (under Empire Offshore Wind Holdings LLC) and BP full ownership of Beacon Wind (under Beacon Wind Holdings LLC). The Beacon Wind lease is located about 20 miles (32 km) south of Nantucket, Massachusetts. Equinor also got BP’s 50% stake in the SBMT, which, as mentioned, will support Empire Wind. BP will become the operator of the Beacon Wind projects and will take over the associated company that owns the Astoria Gateway for Renewable Energy site. In March 2023, Equinor and BP purchased the Astoria Gas Turbines site from NRG to repurpose it as a converter station. The station will connect offshore wind energy production to the New York grid.

“Empire Wind 1 is ready to deliver on New York’s climate and energy goals, with numerous permits and supplier contracts secured. The strong commitment by the state to develop this industry is reflected in the NY4 rapid rebid offering, providing an opportunity to improve value creation for the project,” said Molly Morris, senior vice president for renewables in the Americas at Equinor.

Vestas Gears Up For Massive Order

Danish wind turbine manufacturer, Vestas, has moved forward its conditional agreement to support the Empire Wind project. Vestas’ history with Empire Wind dates back to October 2021, when both phases of the project were part of a preferred supplier agreement.

“After Equinor’s successful rebid into New York’s fourth offshore wind solicitation and with a current conditional order in place for the 810-MW Empire Wind 1 project, Vestas is pleased to see the project moving one step closer to realization and looks forward to providing its type-certified V236-15.0 MW offshore wind turbines,” the company said in a statement.

The first V236-15.0 wind turbine blade. (Image Courtesy Of Vestas)

Vestas’ flagship offshore wind turbine, the V236-15.0 MW, received its type certification late last year ensuring safety and quality. A single unit can produce 80 GWh per year. The V236-15.0 MW rotor diameter is a staggering 774 ft. (236 m) and the prototype blades are 510 ft. (115.5 m). The unit has rated power of 15,000 kW.

The V236-15 MW prototype turbine was installed in December 2022 and is currently undergoing the final verification campaign before Vestas begins serial production and installation of the first offshore projects.

The V236-15.0 MW was the first ever 15-MW turbine to be introduced to the market in February 2021.

“Ensuring the long-term viability and sustainability of the US offshore market relies heavily on the safe, timely, and successful execution of the first wave of projects and this landmark project is a crucial step toward putting turbines in the water,” said Josh Irwin, senior vice president of offshore sales at Vestas North America. “We look forward to delivering an existing, reliable product and partnering with Equinor to help New York achieve its ambitious offshore wind energy goals and provide resilient wind energy to its communities.”

Other Notable Offshore Wind Projects

As part of New York’s fourth offshore wind solicitation, the state also selected Ørsted and Eversource to negotiate a new 25-year contract for their 924-MW Sunrise Wind offshore wind farm. Like Empire Wind, Sunrise Wind will finalize contracts agreements with NYSERDA on an Offshore Wind Renewable Energy Certificate.

Sunrise Wind Map (Image Courtesy Of NYSERDA)

The project has a similar timeline to Empire Wind. The final investment decision is expected in Q2 2024. The full scope of construction and federal permits are expected this summer. The project is expected to enter service in 2026.

Like Empire Wind, the project is undergoing a change in ownership. Joint venture partners Ørsted and Eversource submitted a new proposal for Sunrise Wind in response to New York’s latest offshore wind solicitation, re-bidding an updated project. The Sunrise Wind design has been reviewed and accepted by all relevant state agencies, and the project has secured all major supplier and project labor agreements. With this successful re-bid, Ørsted will acquire Eversource’s 50% ownership share in Sunrise Wind, becoming the sole owner of Sunrise Wind, subject to signing of an OREC contract with NYSERDA, finalization of acquisition agreements, receipt of the federal construction and operations plan, and relevant regulatory approvals. Eversource will remain contracted to lead the project’s onshore construction.