Equinor, a Norwegian energy giant, has marked an important milestone with the achievement of securing more than $3 billion in project financing for its Empire Wind 1 project. The 80,000-acre offshore wind farm, which will be built off the coast of New York, has achieved financial close and will soon be one of the key elements in renewable energy infrastructure in the United States. Located 24 to 48 kilometres southeast of Long Island, the project will be the first offshore wind initiative to connect to the New York City grid, providing clean energy to roughly 500,000 homes. Currently under construction with a contracted capacity of 810 MW, Empire Wind 1 is planned to come on commercial operation by 2027.
Equinor Renewables Americas President Molly Morris said the financial close marked “an important milestone in maintaining the momentum we have built toward bringing a significant new source of power to the grid that will strengthen US energy security and build economic growth.”
The Empire Wind lease was first awarded to Equinor in 2017, but over the years, much has been done. In 2020, Equinor sold an interest in its 50 percent stake in the lease, and another 50% interest in its Beacon Wind lease, offshore Massachusetts. Through that same agreement with bp in a strategic swap for full ownership by 2024, Equinor obtained sole ownership of Empire Wind. Equinor later entered into a 25-year power purchase and sale agreement (PSA) with the New York State Energy Research and Development Authority (NYSERDA) on Empire Wind 1 at a strike price of $155 per MWh later that year.
Strong financial support for Empire Wind 1 has been demonstrated through the high demand from lenders to allow Equinor to lock in attractive financing conditions. The company estimated the total capital investments for the project to amount to about $5 billion. That included fees that relate to the usage of South Brooklyn Marine Terminal (SBMT) as an operations and maintenance hub for the project. The SBMT will be the largest dedicated port facility for offshore wind in the U.S. under this initiative, further solidifying its role as a key logistical center for renewable energy.
Jens Økland, Acting Executive Vice President for Renewables at Equinor noted: “This is an important milestone for Equinor as we continue working in line with our plan on enhancing value and reducing exposure for the Empire Wind 1 project. As we now enter into full execution mode, we also continue our work to increase project robustness and value-creation.”.
The Empire Wind 1 project is going to be very significant in advancing the U.S. renewable energy goals and helping support the transition towards a cleaner, more sustainable energy grid. Using strategic partnerships, competitive financing, and innovative infrastructure, Equinor is seeking to deliver a landmark project that addresses climate concerns but also boosts economic growth in the region.
Once operational, Empire Wind 1 will make a significant contribution to New York State’s clean energy targets while building energy security for millions of residents. The project further underlines Equinor’s commitment to scaling up its renewable energy portfolio globally, focusing on increasing value creation and resilience in its operations. With construction underway and the project running according to plan, Equinor is well on its way to cementing its position as a leader in offshore wind energy.
In an era of burgeoning renewable energy use around the world, the development of projects such as Empire Wind 1 demonstrates how public-private partnership is an indispensable component of managing the two related challenges of meeting energy demand while being environmentally conscious. Equinor’s achievement in raising funding and progressing toward construction marks growing investor and stakeholder confidence in the future of offshore wind as a foundational part of the energy transition.