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It’s Groundhog Day for New York’s Offshore Wind Industry

Equinor and Orsted and Eversource won the new, more expensive contracts.

Matthew Zeitlin •
02/29/2024
Wind turbines.
Heatmap Illustration/Getty Images

New York’s offshore wind industry is back, or at least back in contract. Two offshore wind projects, Empire Wind 1 and Sunrise Wind, were awarded, respectively, to developers Equinor and the partnership of Orsted and Eversource. These two projects, which would amount to 1,700 megawatts of capacity in total (enough to power about a million homes, according to Governor Kathy Hochul’s office), had first been bid out in 2019 and then rebid when these same developers were unable to renegotiate their contracts to deal with rising material and interest rate costs.

Last year was an annus horribilis for the offshore wind industry, with projects cancelled up and down the East Coast and billions of dollars of losses for offshore wind developers. The delayed and cancelled projects have called into question the viability of the Biden administration’s ambitious goal of installing 30 gigawatts of offshore wind by 2030.

This year, however, has seen some signs of recovery. For years, the U.S. offshore wind industry was a bunch of plans and a few dozen megawatts of capacity from wind farms off the coasts of Rhode Island and Virginia. Then came Vineyard Wind 1, off the coast of Massachusetts, which started delivering power early this year, shortly after another New York project, South Fork Wind, started up in December of last year.

But merely (re-)awarding the contracts does not ensure that steel goes into the water, let alone that electrons flow into homes. Sunrise Wind will likely be completed in 2026, according to Orsted. Before that the Danish company has to hammer out the details of a new contract, and only then finally decide whether to go through with the thing or not; that’s expected to happen sometime in the second quarter of this year, with federal permitting finished in the summer. Empire Wind 1 has a similar timeline.

According to the governor’s office, utility customers will feel these contracts to the tune of an extra $2 a month. When the projects were first bid out in 2019, the expected impact on utility bills was just $0.73.

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Matthew Zeitlin profile image

Matthew Zeitlin

Matthew is a correspondent at Heatmap. Previously he was an economics reporter at Grid, where he covered macroeconomics and energy, and a business reporter at BuzzFeed News, where he covered finance. He has written for The New York Times, the Guardian, Barron's, and New York Magazine.

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Sparks

The Country’s Largest Power Markets Are Getting More Gas

Three companies are joining forces to add at least a gigawatt of new generation by 2029. The question is whether they can actually do it.

Matthew Zeitlin •
02/26/2025
Natural gas pipelines.
Heatmap Illustration/Getty Images

Two of the biggest electricity markets in the country — the 13-state PJM Interconnection, which spans the Mid-Atlantic and the Midwest, and ERCOT, which covers nearly all of Texas — want more natural gas. Both are projecting immense increases in electricity demand thanks to data centers and electrification. And both have had bouts of market weirdness and dysfunction, with ERCOT experiencing spiky prices and even blackouts during extreme weather and PJM making enormous payouts largely to gas and coal operators to lock in their “capacity,” i.e. their ability to provide power when most needed.

Now a trio of companies, including the independent power producer NRG, the turbine manufacturer GE Vernova, and a subsidiary of the construction firm Kiewit Corporation, are teaming up with a plan to bring gas-powered plants to PJM and ERCOT, the companies announced today.

The three companies said that the new joint venture “will work to advance four projects totaling over 5 gigawatts” of natural gas combined cycle plants to the two power markets, with over a gigawatt coming by 2029. The companies said that they could eventually build 10 to 15 gigawatts “and expand to other areas across the U.S.”

So far, PJM and Texas’ call for new gas has been more widely heard than answered. The power producer Calpine said last year that it would look into developing more gas in PJM, but actual investment announcements have been scarce, although at least one gas plant scheduled to close has said it would stay open.

So far, across the country, planned new additions to the grid are still overwhelmingly solar and battery storage, according to the Energy Information Administration, whose data shows some 63 gigawatts of planned capacity scheduled to be added this year, with more than half being solar and over 80% being storage.

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Sparks

An Emergency Trump-Coded Appeal to Save the Hydrogen Tax Credit

Featuring China, fossil fuels, and data centers.

Emily Pontecorvo •
02/18/2025
The Capitol.
Heatmap Illustration/Getty Images

As Republicans in Congress go hunting for ways to slash spending to carry out President Trump’s agenda, more than 100 energy businesses, trade groups, and advocacy organizations sent a letter to key House and Senate leaders on Tuesday requesting that one particular line item be spared: the hydrogen tax credit.

The tax credit “will serve as a catalyst to propel the United States to global energy dominance,” the letter argues, “while advancing American competitiveness in energy technologies that our adversaries are actively pursuing.” The Fuel Cell and Hydrogen Energy Association organized the letter, which features signatures from the American Petroleum Institute, the U.S. Chamber of Commerce, the Clean Energy Buyers Association, and numerous hydrogen, industrial gas, and chemical companies, among many others. Three out of the seven regional clean hydrogen hubs — the Mid-Atlantic, Heartland, and Pacific Northwest hubs — are also listed.

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Sparks

Why Your Car Insurance Bill Is Making Renewables More Expensive

Core inflation is up, meaning that interest rates are unlikely to go down anytime soon.

Matthew Zeitlin •
02/12/2025
Wind turbines being built.
Heatmap Illustration/Getty Images

The Fed on Wednesday issued a report showing substantial increases in the price of eggs, used cars, and auto insurance — data that could spell bad news for the renewables economy.

Though some of those factors had already been widely reported on, the overall rise in prices exceeded analysts’ expectations. With overall inflation still elevated — reaching an annual rate of 3%, while “core” inflation, stripping out food and energy, rose to 3.3%, after an unexpectedly sharp 0.4% jump in January alone — any prospect of substantial interest rate cuts from the Federal Reserve has dwindled even further.

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