Great potential for Esvagt in US wind
The European market leader in offshore wind, ESVAGT has closely followed the development of the rapidly growing American offshore wind market. Now, ESVAGT is establishing an American joint venture with Crowley group based in Jacksonville, Florida.
“The US has ambitions to develop offshore wind to a level that matches the current level in Europe. If you consider yourself a key player in the green transition, and at ESVAGT we do just that, you want to take part in fulfilling those ambitions”, says ESVAGT’s CEO Peter Lytzen.
“Offshore wind has evolved from a European project to a global industry. Naturally, we look at how we can expand and join our customers on new markets with potential, and the United States certainly falls into that category”, he says.
Most likely, the many GW of offshore wind energy planned in the US will be commissioned by experienced European companies with the right knowledge and track record.
“There is a critical mass and a green ambition one can only admire. In addition, the American market is characterized by players we have worked with for many years in Europe. We know that they value a safe, efficient and competent partner in building a new, green industry and we are confident our SOV concept (Service Operation Vessels for servicing offshore wind farms), experience and competencies can make a positive difference in the US”, says Søren Karas, Chief Commercial Officer.
However, establishing a US operation is far from easy.
The American Jones Act law dictates that all vessels operating domestically in the United States must be built in the United States, fly the American flag, have a U.S. crew, and be majority owned by a U.S. citizen. With ESVAGT carrying Danish flag, a primarily Scandinavian crew and a fleet of vessels built in Norway, Singapore, Spain and Turkey, compliance with the Jones Act is no easy feat.
“It is cumbersome and a hassle, and that is just the way it is. We have gotten to know our legal team a lot better. However, the many in-depth, detailed discussions have also helped to clarify for all of us how we want to work as a joint venture”, says Søren Karas.
Peter Lytzen, who has experienced the joint venture process before, agrees:
“Much of what we have done in order to operate under compliance with the Jones Act isalso relevant to the partnership itself. A joint venture is a marriage and spending a lot of time solving a difficult structural task together is not a bad thing for the further process”, says Peter Lytzen.
ESVAGT has collaborated with the Danish embassy to find the right partner for a joint venture. The list of formal requirements, wishes and thoughts about what the ideal partner should look like has been long:
“At the beginning of such a process, it is facts and checklists: We are looking for a match on our desires for infrastructure, access to competencies and a strong local network for example. That part is relatively simple”, says Peter Lytzen.
“It is more difficult to formulate how the ideal partner should act and condone itself. ESVAGT is a company based on a strong set of value principles, and it was probably implicit that our partner should be, too. We have sought a partner where we can recognize our set of values in theirs”, he says.