New Jersey’s First Offshore Wind Farm Gets Final Approvals from BOEM
The Atlantic Shores South project, which would consist of two large offshore wind farms, received its final approval from the Bureau of Ocean Energy Management. It is a critical step for a state that says it is dedicated to making clean energy a priority but which continues to suffer setbacks in its ambitions.
The project is a 50/50 partnership between Shell New Energies US and EDF-RE Offshore Development and will become New Jersey’s first offshore wind energy site. BOEM approved the construction and operation plan for the development which calls for up to 2.8 GW of power between two equally sized projects. They highlight it could power up to one million homes.
Called Atlantic Shores 1 and 2, it will be located at its closest point at nearly nine miles from the Jersey coast but the company has previously said construction will be at least 12.8 miles from shore. It will be in a region between Atlantic City, Sea Girt, and Long Beach Island in southern New Jersey. The plan calls for up to 197 wind turbines as well as the necessary substations and other equipment.
“Securing these critical approvals enables New Jersey’s first offshore wind project to start construction next year and represents meaningful progress in New Jersey achieving 100 percent clean energy by 2035,” said Joris Veldhoven, Chief Executive Officer, Atlantic Shores Offshore Wind. He said the first phase Atlantic Shores 1 would start moving forward and that the second phase would build on the first-mover success to drive the state over the next decade.
The project is moving forward despite significant local opposition. Various groups have fought to prevent the development of the project.
For New Jersey, it represents a restart after Ørsted canceled its two large projects in 2023 which were expected to be the first in the state. New Jersey has other projects in the development pipeline but they too have encountered difficulties.
Last week, the New Jersey Board of Public Utilities granted Leading Light Wind a pause on its project through December 20. The project is in the licensing phase after having been selected by the state but the developer which is a partnership between two American companies, Invenergy and energyRe, reporting it is having problems securing a supplier agreement for its turbines. The plan calls for it to be located over 40 miles off the coast, generating 2.4 GW of energy. Construction was projected to begin by 2028 and be in operation by 2031.
New Jersey also ran a solicitation over the summer but reported it only received three proposals in July. That included Atlantic Shores, which was seeking to reset a prior price agreement as well as Attentive Energy which was the other developer selected in January alongside Leading Light. They are proposing a second phase while Community Wind also resubmitted a reworked proposal for a project that was previously passed over in the selection process. The state said it would announce its steps forward by December.
Ørsted Has New U.S. Wind Partner as Eversource Exits and GIP Enters
Institutional investors continue to show interest in the developing offshore energy sector demonstrated by the closing of a deal that rearranges the partnership for Ørsted in its U.S. offshore wind energy projects. Global Infrastructure Partners, which was acquired by famed group BlackRock, completed the previously announced deal to buy Eversource Energy’s 50 percent interest in two wind farms with Ørsted.
Eversource had previously announced its intent to exit the offshore wind sector to focus on operations as a pure-play regulated pipes and wires utility. They agreed earlier this year to sell their share of the planned Sunrise Wind project to Ørsted and yesterday completed the sale of its shares in South Fork Wind and Revolution Wind to Global Infrastructure Partners (GIP). While Eversource has exited its offshore wind investments, the company remains a contractor on the ongoing onshore construction scope for Revolution Wind, and a tax equity investor in South Fork Wind.
The final price for the 50 percent shares of the two U.S. offshore wind farms was $745 million, which was reduced by approximately $375 million from the original value of $1.12 billion on the deal. Eversource cited increased construction costs and delays for Revolution Wind. With a $370 million gain on the separate sale of Sunrise Wind, Eversource still expects to record a loss of $520 million for the divestiture of its offshore wind interests.
GIP, however, cites the strong opportunities in renewable energy. Today, October 1, BlackRock completed the acquisition of GIP with the two companies also emphasizing their positioning as an industry leader in infrastructure and strong position in renewable energy.
A new joint venture partnership will be launched between Ørsted and Skyborn Renewables, a GIP portfolio company, for the two offshore wind projects. The companies emphasized that this reaffirms the opportunity in American clean energy.
In partnership with GIP, Ørsted will continue its operations of the 132-megawatt South Fork Wind farm, and finalize construction of the 704-megawatt Revolution Wind project and transition it into its operational phase. South Fork Wind went into operation in March 2024 as America’s first utility-scale offshore wind farm supplying power to New York. Construction is underway on Revolution Wind, which will serve Rhode Island and Connecticut, and in September it marked the installation of its first wind turbine offshore.
Ørsted previously acquired Eversource’s 50-percent stake in the 924-megawatt New York Sunrise Wind project, share of uncontracted offshore wind seabed (Lease 500), and key Northeast operational assets.
As part of a growing Northeast hub, Ørsted also has full ownership of partnerships with the Port of Providence, the Port of Davisville, and Quonset Point, all in Rhode Island, and with Connecticut's New London State Pier. Ørsted also acquired ownership of the future operations and maintenance hub in East Setauket, N.Y., and the charter agreement for the first American-built offshore wind service operations vessel Eco Edison.
Institutional investors are showing increasing interest in the offshore energy sector as it begins to mature and promises consistent returns. Energy companies such as Eversource however which were early investors in the sector have retreated as the problems emerged that drove up costs and delayed the offshore projects.
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