Ørsted Repositions Skipjack Wind Project for Future Opportunities Amid Challenging Market Conditions

Ørsted Repositions Skipjack Wind Project for Future Opportunities Amid Challenging Market Conditions

(IN BRIEF) Ørsted has announced its decision to reposition the Skipjack Wind project, a combined 966 MW offshore wind project off the coast of the Delmarva peninsula in the US, to explore future offtake opportunities. In consultation with the State of Maryland, Ørsted has withdrawn from the Maryland Public Service Commission orders approving the Skipjack 1 and 2 projects. The company cited challenging market conditions, including inflation, high interest rates, and supply chain constraints, making the originally set payment amounts for Offshore Renewable Energy Credits (ORECs) commercially unviable. Despite this, Ørsted is committed to advancing the project’s development, including submitting an updated Construction and Operations Plan to the Bureau of Ocean Energy Management (BOEM), and seeks to leverage the strategic location and support from the state for future prospects. Ørsted is also actively involved in other US offshore wind projects and has significant uncontracted seabed holdings along the US East Coast, poised for further growth in the expanding offshore wind industry.

(PRESS RELEASE) FREDERICIA, 26-Jan-2024 — /EuropaWire/ — Ørsted announced that it will reposition Skipjack Wind, a combined 966 MW project under development off the coast of the Delmarva peninsula in the US, for future offtake opportunities.

Following consultation with the State of Maryland, Ørsted has withdrawn from the Maryland Public Service Commission orders approving the Skipjack 1 and 2 projects. Ørsted intends to continue advancing development and permitting for the combined project, including submission of its updated Construction and Operations Plan to the Bureau of Ocean Energy Management (BOEM).

This action follows an extensive review of the orders. The payment amounts for ORECs set forth in the orders are no longer commercially viable because of today’s challenging market conditions, including inflation, high interest rates and supply chain constraints.

“Announcement affirms our commitment to developing value creating projects and represents an opportunity to reposition Skipjack Wind, located in a strategically valuable federal lease area and with a state that’s highly supportive of offshore wind, for future offtake opportunities,” said David Hardy, Executive Vice President and CEO of Region Americas at Ørsted. “As we explore the best path forward for Skipjack Wind, we anticipate several opportunities and will evaluate each as it becomes available. We’ll continue to advance Skipjack Wind’s development milestones, including its construction and operations plan.”

“We’re grateful to Governor Moore, the Maryland Public Service Commission and the State of Maryland for their steadfast partnership and support as we have worked diligently to develop Skipjack Wind under challenging economic circumstances,” Hardy continued. “We fully support the state’s leadership as they pursue their ambitious offshore wind goal. We also thank the State of Delaware for its collaborative approach to supporting Skipjack Wind’s development.”

Ørsted continues to advance, build, and invest into several US offshore wind projects. With its partner Eversource, its South Fork Wind project serving New York is set to reach full operation in the weeks ahead as the first commercial-scale offshore wind farm in America. Revolution Wind, also with Eversource and delivering power to Rhode Island and Connecticut, has already started construction activities. Sunrise Wind, also serving New York, was re-submitted today in the New York 4 solicitation, which, if awarded, would improve the project’s financial position and advance the most mature offshore wind project in the state’s pipeline.

In addition, Ørsted maintains valuable uncontracted seabed along the US East Coast that is strategically positioned to create value and continue growing the US industry. In the Northeast, approximately 10 GW of offshore wind energy is expected to be awarded this year, and the Mid-Atlantic has additional solicitations expected in the next 1-2 years.

About Ørsted
The Ørsted vision is a world that runs entirely on green energy. Ørsted develops, constructs, and operates offshore and onshore wind farms, solar farms, energy storage facilities, renewable hydrogen and green fuels facilities, and bioenergy plants. Ørsted is recognised on the CDP Climate Change A List as a global leader on climate action and was the first energy company in the world to have its science-based net-zero emissions target validated by the Science Based Targets initiative (SBTi). Headquartered in Denmark, Ørsted employs approx. 8,700 people. Ørsted’s shares are listed on Nasdaq Copenhagen (Orsted). In 2022, the group’s revenue was DKK 132.3 billion (EUR 17.8 billion). Visit orsted.com or follow us on Facebook, LinkedIn, Instagram, and X.

Media Contact:

Global Media Relations:
Tom Christiansen
+45 99 55 60 17
tomlc@orsted.com

Investor Relations:
Rasmus Keglberg Hærvig
+45 99 55 90 95
ir@orsted.com

SOURCE: Ørsted A/S