Eversource expects to reach a deal this quarter to sell off its offshore wind interests.
CEO Joe Nolan last week said negotiations are far along with two potential buyers.
But the sale will not end its involvement in the offshore sector, he said. Eversource expects to concentrate on the transmission of power generated by fleets of offshore turbines, rather than the turbines themselves.
Nolan’s remarks came Wednesday during a call with industry analysts to discuss the company’s first-quarter earnings.
The question-and-answer portion of the call returned repeatedly to Eversource’s plans to offload its assets in the offshore wind sector, which has experienced rising costs as the first of thousands of megawatts of planned capacity is developed off the Northeast coast.
In Massachusetts, Commonwealth Wind and SouthCoast Wind have both said their projects are now untenable under their existing power purchase agreements, though only Commonwealth has formally attempted to back out.
Eversource teamed up with Denmark’s Ørsted, the largest offshore wind developer in the world, in a 50/50 joint venture to develop South Fork Wind, Revolution Wind and Sunrise Wind. Construction has begun on South Fork and is expected to start later this year on Revolution.
The two have also proposed Sunrise Wind 2 and Revolution Wind 2.
Eversource said over a year ago that it was considering sale. Nolan said Wednesday that negotiations on its leases and contracts are now in late stages.
“Our transaction will involve two parties. It is very far along in the process; that’s why we can tell you with a very high degree of confidence that you will have an announcement in the second quarter,” he said.
Nolan said they will bring a good price.
“These are very mature projects; these are not just concepts on paper … so for that I think we’ll recognize good value for those projects. … I think that at the end of the day it will be a very good outcome for Eversource and for Eversource’s shareholders.”
An analyst asked if the company might retain a smaller ownership share than 50%.
“We see a path for a clean exit from this, so that is definitely not the case,” Nolan said.
Another analyst asked whether Eversource is planning to move into transmission of power from offshore generators.
Nolan replied that the company sees great opportunity to work with Ørsted and other developers to import clean energy to the ISO-NE and NYISO grids.
“That was one of the points that had us make the pivot because we think there’s so much opportunity in both the land aspect of it and the investment around not only the projects that we were involved in, but the projects that everybody else is involved in,” he said. “We are very well positioned in this region at load centers, and people want to get to them. … We see a tremendous opportunity for investment in offshore wind as it relates to our regulated business and that’s really what our focus is — de-risking and focusing on our regulated assets.”
