Ørsted has agreed to offload an equity ownership interest in a portfolio consisting of four operational US onshore wind farms with a total capacity of 957MW to alternative investment firm Stonepeak in a deal worth around €300m.
The deal includes the Ford Ridge Wind project in Illinois, the Helena Wind and Western Trail Wind projects in Texas, and the Sunflower Wind project in Kansas.
Put together, the assets cover three different markets, namely the Electric Reliability Council of Texas (ERCOT), Midcontinent Independent System Operator (MISO), and Southwest Power Pool (SPP).
All the four onshore wind farms are underpinned by power purchase agreements for 100% or parts of their production capacities.
The Danish energy company had previously secured about $700m in tax equity proceeds for this wind portfolio, which brings the total proceeds raised to nearly $1bn.
In line with the transaction, Stonepeak will receive 80% of the cash distributions associated with the onshore wind projects while Ørsted will continue to operate them.
Stonepeak senior managing director Anthony Borreca said: “Ørsted’s US onshore assets are young and have been built with trusted technology, which gives us confidence in their potential to make a meaningful and positive long-term impact on the communities they serve.”
The divestiture is part of Ørsted’s farm-down programme. It is the second major farm-down of multiple assets for the Danish firm in the US.
According to Ørsted, the partnership with Stonepeak will enable the company to recycle capital to support its business strategy and future value-generating clean energy projects.
Ørsted executive vice president and Americas CEO David Hardy said: “This deal signifies the value that our US onshore renewable energy projects can deliver to our investors while also demonstrating the holistic and flexible approach we take to partnerships and divestments.
“While Ørsted will continue to operate each asset over its lifetime, we’ll use this capital to fund projects that continue to create the most value for our stakeholders and fuel our growth in the renewable energy sector.”
Separately, Equinor announced the US Federal Energy Regulatory Commission (FERC)`s approval of the agreement signed between its Empire Wind 1 offshore wind project, New York ISO, and Consolidated Edison Company of New York.
The authorisation enables the 810MW American offshore wind project to connect via the Sunset Park Onshore Substation at South Brooklyn Marine Terminal (SBMT) into the New York City electrical grid at Con Edison’s Gowanus substation.
