Ørsted to buy Deepwater Wind for $510m
Danish firm eliminates competitor; retains Grybowski as co-CEO in US
TWO OF THE BIGGER PLAYERS in the emerging US offshore wind industry are combining forces, as the Denmark-based Ørsted announced an agreement on Monday to purchase Deepwater Wind of Rhode Island for $510 million.
The deal eliminates one of Ørsted’s leading competitors along the East Coast and creates a company with offshore wind contracts or development rights for projects off the coast of seven states along the East Coast.
Deepwater Wind built the nation’s first wind farm near Block Island and has projects in development in Rhode Island, Connecticut, Maryland, and New York. It also has lease rights for offshore wind projects in Massachusetts and Delaware.
Ørsted touts itself as the world’s largest offshore wind developer. In the United States, it has lease rights for projects in Massachusetts and New Jersey and is under contract to build an offshore wind project for Dominion Energy off the coast of Virginia.
Ørsted and Deepwater Wind competed fiercely for a Massachusetts offshore wind contract earlier this year and neither ended up winning, although Deepwater Wind won a 400 megawatt contract with Rhode Island as part of the process. Massachusetts ended up awarding an 800 megawatt contract to the third company bidding for the contract, Vineyard Wind.
Massachusetts is looking to award contracts for another 800 megawatts of electricity. Although Ørsted’s acquisition of Deepwater Wind means there will be one less competitor, other companies, including Equinor and the PNE Wind Group, are seeking offshore wind leases off the coast of Massachusetts from the federal government. “I think you’ll see a lot of competition,” Brostrom said in a telephone interview.
Grybowski said his company has been looking for additional investors and/or partners for several years, a process that accelerated with its success in landing wind power contracts requiring billions of dollars in investments. He said talks accelerated over the last few months with Ørsted and came to fruition recently.Brostrom said the company’s 50-50 partnership in Massachusetts with Eversource Energy would remain in place, and he said he would even like to see it expand.