Equinor Secures $3B in Financing as Empire Wind 1 Moves Forward
A project financing package was completed at the end of December to continue the momentum for the development of another of the early, large offshore wind farms off the Northern U.S. Coast. Equinor reports it secured more than $3 billion in project financing for Empire Wind 1 on competitive terms due to strong interest from lenders.
The Empire Wind 1 project, which will be located between 15 and 30 miles southeast of Long Island is already in the first stages of construction. It is expected to reach commercial operations in 2027.
“This is an important milestone for Equinor, in line with our plan to enhance value and reduce exposure in the Empire Wind 1 project. As we now enter full execution mode, we continue our efforts to increase robustness and value-creation in the project,” said Jens Økland, acting executive vice president for Renewables in Equinor.
The lease was awarded in 2017 to Equinor but in 2020 it was part of the company’s agreement with BP to develop a joint venture for offshore wind. The JV however was dissolved in 2024 with Equinor taking full ownership of Empire Wind with the company saying it was moving forward in what is expected to be a $5 billion investment. BP took ownership of the Beacon Wind lease and projects in the swap agreement.
While work is proceeding, Equinor however reports that it intends to take on a new partner for the project to further enhance value and reduce its risk. The company did not indicate where it stands in the search for a partner but in general private equity investors have shown strong interest in projects once they reach the development stage,
The plan for Empire Wind split the lease area into two projects with the first phase having a contracted capacity of 810 MW. A 25-year Purchase and Sale Agreement for the power from Empire 1 was struck in June 2024 with NYSERDA (New York State Energy Research and Development Authority).
As part of the project, Empire Wind 1 is participating in the redevelopment of the South Brooklyn Marine Terminal to support the project. New York City is supporting the effort to develop the wind terminal which the company says will create more than 1,000 union jobs in the construction phase.
The second wind farm, Empire Wind 2, is in an early stage of planning and regulatory approval. It has a potential capacity of more than 1,200 MW.
In announcing the project financing, the company said the agreement maintains the momentum toward bringing a significant power source to the New York grid.
BOEM Calls for Input for Offshore Wind Energy Leasing in Guam
In the final weeks of the Biden administration, the Department of Interior’s Bureau of Ocean Energy Management is still pushing forward with its development efforts for offshore wind energy. BOEM on Monday, January 6, will release a Call for Information and Nominations for possible wind energy leasing off the coast of Guam, a Pacific Island territory located approximately 6,000 miles to the west of California.
The call initiates a 90-day comment period which will run till April 7, 2025, and into the next Trump administration. It comes as the President-elect made his most recent criticism of wind energy. Yesterday, January 2, Trump wrote on his social media platform “The U.K. is making a very big mistake. Open up the North Sea. Get rid of Windmills!,” in response to news the UK government was extending a North Sea tax designed to accelerate the transition for the oil and gas industry to renewable energy. During the campaign, Trump promised to stop the “windmills.”
Call is broadly encompassing the areas around Guam (BOEM)
BOEM has been in discussions and hosting forums in Guam and elsewhere noting that the Inflation Reduction Act (IRA) of 2022 contained several provisions relevant to BOEM’s offshore energy program including expanding the efforts to Guam, Hawaii, and elsewhere. BOEM highlights it is facilitating the Biden-Harris Administration’s goal of deploying 30 gigawatts of offshore wind energy capacity by 2030, and 15 GW of floating offshore wind energy capacity by 2035.
The Government of Guam and BOEM initiated the first planning step in the renewable energy authorization process by establishing an intergovernmental renewable energy task force at the request of the Honorable Lourdes “Lou” Aflague Leon Guerrero, the Governor of Guam since 2019. The task force had its last meeting in September 2024 and public engagement and environmental studies have been initiated.
The southernmost and largest island in the Mariana Islands, as well as the largest in Micronesia, Guam is just over 200 square miles. A U.S. territory since 1898 and the U.S. victory over Spain in the Spanish-American War, the island is home to a vital U.S. Navy base providing the U.S. a territory in Asia.
The call seeks to analyze potential use conflicts before designating specific wind energy areas. Using the input, BOEM would select the areas with the least impact and greatest potential/interest. One contagious area around the island that comprises approximately 2.1 million acres is included in the call. The area begins about three nautical miles from shore and encompasses water depths from approximately 350 to 2200 meters (approximately a quarter of a mile to 1.4 miles).
In addition to the input from public and government agencies, BOEM notes wind energy companies can use the call period to nominate specific areas they would like to see offered for leasing.
The bureau notes if it receives commercial interest in wind leasing offshore Guam, the next step would be to identify WEAs for leasing consideration within the larger call area. BOEM would then conduct environmental reviews of the WEAs in consultation with appropriate federal agencies, the Government of Guam, and other key stakeholders. After completing its environmental reviews and consultations, BOEM may propose one or more competitive lease sales for areas within the WEAs.
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