Danish energy company Orsted's (ORSTED.CO) South Fork offshore wind farm off New York State delivered its first power to the state's power grid, according to a press release by New York Governor Kathy Hochul on Wednesday.The announcement is a bit of positive news in what has been a tough year for the nascent industry in the United States, which has faced financial troubles in recent months.
"East Hampton has now made history as the first community in New York to receive clean energy from an offshore wind farm," David Hardy, Orsted's head of Region Americas, said in statement.
South Fork, which Orsted is building with U.S. energy firm Eversource (ES.N), will eventually consist of 12 Siemens Gamesa turbines with a total installed capacity of 132 megawatts (MW) and is situated 35 miles (56 kilometres) east of Montauk Point in New York. Siemens Gamesa is a unit of German energy firm Siemens Energy (ENR1n.DE).
The production milestone is welcome news for embattled Orsted, which has faced massive headwinds for other U.S. offshore wind projects forcing it to book large impairments that sent its share price tumbling.
Earlier this year, Orsted had unsuccessfully sought an improved electricity off-take price for its other New York offshore wind farm, Sunrise (924 MW), due to soaring costs that could derail the project.
Offshore wind is expected to play a major role in New York's plan to reduce carbon emissions by getting 70% of the state's electricity from renewable sources by 2030. It is also a pillar of President Joe Biden's plan to decarbonize the U.S. power grid and combat climate change.
In November, New York launched a new offshore wind solicitation to help support the development of 9,000 megawatts (MW) of offshore wind by 2035, enough to power up to six million homes.
Separately, Avangrid (AGR.N) said on Wednesday it completed installation of the first five turbines on its 806 MW Vineyard Wind 1 offshore wind project off Massachusetts as it prepares to deliver first power in coming weeks.
Avangrid is majority owned by Spanish energy company Iberdrola (IBE.MC).
