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United States

Avangrid Renewables delays US offshore wind projects as supply chain costs rise

Iberdrola-owned Avangrid Renewables is delaying two major offshore wind projects in the US because of supply chain issues, CEO Pedro Azagra has told investors.

Avangrid's under-construction 800MW Vineyard Wind joint venture with CIP is not affected by the decision (pic: Heerema Marine Contractors)
Avangrid's under-construction 800MW Vineyard Wind joint venture with CIP is not affected by the decision (pic: Heerema Marine Contractors)

The 804MW Park City Wind (Vineyard Wind South phase 1) Park City Wind (Vineyard Wind South phase 1) (804MW) OffshoreMassachusetts, USA, North America Click to see full details and 1232MW Commonwealth Wind Commonwealth Wind (1232MW) OffshoreMassachusetts, USA, North America Click to see full details projects, planned for south of Martha’s Vineyard, Massachusetts, will be pushed back by a year – to 2027 and 2028 respectively — Azagra said in an investors meeting in New York City.

The projects will supply consumers in Connecticut and Massachusetts.

In Avangrid’s presentation, Azagra said strong increases in commodity prices, especially steel, have taken place since bids had been submitted for Park City in 2019 and Commonwealth Wind in 2021, reported the Boston Globe.

Avangrid will renegotiate contracts with suppliers, utilities – the United Illuminating Company and Eversource Energy -- and state officials who oversaw the solicitations. Azagra said he expects it will result in only a modest increase in price, according to the Boston Globe.

“If you would do an auction right now, the prices would be materially different,” Azagra told the Globe in an interview afterwards. “We need to be realistic right now. The world has changed.”

The delays are not caused by the injunction recently imposed on GE’s Haliade-X turbine, Azagra added. A Massachusetts federal judge issued the injunction because the current design of the Haliade X infringes a patent owned by Siemens Gamesa Renewable Energy (SGRE),

Azagra said Avangrid’s 800MW Vineyard Wind 1 Vineyard Wind 1 (800MW) Offshoreoff Martha's Vineyard, Massachusetts, USA, North America Click to see full details joint venture – with Copenhagen Infrastructure Partners (CIP) – is on track to deliver electricity to the grid in 2023. The judge allowed a carve-out from the injunction, so that Haliade-Xs can still be used in Vineyard Wind, although a $30,000/MW royalty fee will have to be paid by GE to SGRE for the project.

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