Denmark-based Ørsted A/S (CPH:ORSTED) will provide a guarantee of up to USD 100 million (EUR 105.5m) against the construction of the 1.1-GW Ocean Wind 1 project offshore New Jersey within the approved timeline.
The performance security to Ocean Wind LLC’s activities was approved at New Jersey’s Board of Public Utilities meeting on Wednesday. With the parent company guarantee, the company commits to a staged commissioning of the wind farm within set deadlines. In case it fails to bring the capacity online within 12 months of those deadlines, or by December 2025, it will forfeit the money.
Ørsted submitted the guarantee proposal on October 4 following the signing of Governor Phil Murphy’s bill in July that allows Ørsted to receive federal credits it would have otherwise been required to return to ratepayers.
Ocean Wind 1, located about 13 nautical miles southeast of Atlantic City, is expected to start installing its monopile foundations and GE Haliade-X wind turbines in 2024 and begin supplying power to New Jersey in 2025. The deadlines for its phased completion are by May 1, September 1 and December 1, 2024.
The construction and operation plan for the 98-turbine Ocean Wind 1, the US’ third commercial-scale offshore wind project, was cleared by the Department of the Interior in July. A month later, Ørsted said it would suffer impairments on its near-term US offshore development projects, including Ocean Wind 1, due to supply chain issues, lack of favourable progress in Investment Tax Credit (ITC) guidance and higher interest rates.
(USD 1.0 = EUR 1.055)