New Jersey-based utility holding company Public Service Enterprise Group is acquiring a 25 percent interest in a planned 1,100-MW offshore wind project.
PSEG entered into a definitive agreement with Ørsted North America to take the position in the Ocean Wind project. The utility will bring its regional experience working with energy infrastructure to partner with Ørsted’s global wind project development expertise, the parties said.
“As New Jersey’s first offshore wind project, Ocean Wind will lead the way for a productive first step into this forward-leaning industry, bringing with it new skills, jobs and carbon-free energy,” PSEG CEO Ralph Izzo said. “Further, this investment in offshore wind energy is well-aligned with our company’s long-term clean energy strategy. We’re excited to continue our close relationship with Ørsted, combining each organization’s expertise to achieve powerful benefits for energy consumers and the state.”
Once completed and operational, the Ocean Wind project will half a million New Jersey homes from its location off the coast of southern New Jersey. Ocean Wind was selected by the state to be the first offshore wind farm as part of its intention to add 7,500 MW of offshore wind generating capacity by 2035.
The Ocean Wind project could provide first power in late 2024, subject to federal permitting timelines, other development and construction activities, and final investment decisions by Ørsted and PSEG. Completion of the acquisition is anticipated to occur in the first half of 2021, subject to approval by the New Jersey Board of Public Utilities and other customary closing conditions.
On July 31, PSEG announced it would explore strategic alternatives related to PSEG Power’s non-nuclear generation fleet, accelerating PSEG’s transition to a primarily regulated and contracted business with a zero-carbon generation platform. In line with this strategy, PSEG continues to evaluate participation in additional offshore wind opportunities in New Jersey and other mid-Atlantic states.
Ørsted operates 26 wind farms globally including the U.S.’s first offshore wind farm, the Block Island Wind Farm. In January, Ørsted was named the most sustainable company in the world by Corporate Knights.
Wachtell, Lipton, Rosen & Katz is serving as transactional counsel to PSEG. Skadden, Arps, Slate, Meagher & Flom LLP is serving as transaction counsel to Ørsted.