BOSTON & HARTFORD, Conn. - Eversource Energy (NYSE:ES), known for operating New England's largest energy delivery system, has completed the definitive agreements to sell its 50 percent ownership in the Sunrise Wind project to Ørsted, a global leader in offshore wind.
The transaction, which was initially announced on January 24, 2024, is expected to close later this year subject to regulatory approvals and execution of a contract with the New York State Energy Research and Development Authority (NYSERDA).
Despite divesting its stake, Eversource will continue to play a significant role in the Sunrise Wind project by leading the onshore construction under a separate agreement. As a service provider, the company will not retain any ownership interest or financial obligations related to the project's costs post-closing.
Joe Nolan, Eversource Energy's CEO and President, expressed pride in the company's contributions to the Sunrise Wind project and anticipation for the continued collaboration in support of New York's clean energy objectives.
Nolan highlighted the expected economic and employment benefits for New York, particularly through job creation for the local union responsible for constructing the project's onshore transmission system.
The Sunrise Wind project, which has a capacity of 924 megawatts, was selected by New York State in February 2024 to proceed with contract negotiations with NYSERDA after a competitive bidding process. The project is poised to contribute to the reduction of carbon emissions and support the advancement of a clean energy future in the region.
Eversource, serving approximately 4.4 million customers across Connecticut, Massachusetts, and New Hampshire, has enlisted Goldman Sachs as its financial advisor and Ropes & Gray LLP as legal counsel to assist with the transactions.
This development is based on a press release statement.
InvestingPro Insights
Eversource Energy (NYSE:ES), while taking a strategic step in its collaboration with Ørsted, operates with a significant debt burden, as noted in one of the InvestingPro Tips. This could impact the company's financial flexibility and its ability to fund future projects or manage unexpected expenses. Despite this, the company has demonstrated a strong commitment to shareholder returns, having raised its dividend for 25 consecutive years—a streak that continued through the last twelve months as of Q1 2023.
InvestingPro Data shows Eversource with a market capitalization of $20.69 billion, reflecting its substantial presence in the energy sector. The company's P/E ratio, adjusted for the last twelve months as of Q4 2023, stands at 16.44, which could suggest a more favorable valuation in comparison to the unadjusted P/E ratio of -46.52. Additionally, the dividend yield as of early 2024 is quite attractive at 4.85%, which may be of interest to income-focused investors.
Looking ahead, analysts predict that Eversource will be profitable this year, as per another InvestingPro Tip. This anticipated turnaround in profitability, coupled with the company's history of dividend growth—12.16% over the last twelve months as of Q4 2023—could signal a potentially positive outlook for investors.
For readers looking to gain deeper insights into Eversource Energy's financial health and future prospects, additional InvestingPro Tips are available at https://www.investing.com/pro/ES. And for those considering an upgrade to a yearly or biyearly Pro and Pro+ subscription, use coupon code PRONEWS24 to receive an additional 10% off.
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