Saving Seafood

Fallout as Ørsted unwinds Ocean Wind 1 project

November 7, 2023 — After dropping its flagship U.S. project Ocean Wind, Ørsted is seeking to pull back $300 million in obligations to New Jersey.

Once its board of directors had decided to kill the 1,100-megawatt plan on Oct. 31, the next day Ørsted notified the state Board of Public Utilities that it wants to get back a $100 million guarantee that it would complete the project. The company is also pulling back on $200 million it had planned to invest with steel fabricator EEW for its monopile foundation manufacturing plan in Paulsboro, N.J.

Ørsted and state officials signed off on those promises just weeks before the surprise announcement that Ocean Wind 1 and 2 would not be built – a move that Ørsted CEO Mads Nipper said would address more than 70 percent of the company’s recent $2.3 billion writedown of its assets in the beleaguered U.S. offshore wind market.

Read the full article at the National Fisherman

Orsted wants out of $300M forfeiture for scrapped New Jersey offshore wind farms

November 7, 2023 — Offshore wind power company Orsted is trying to get out of a $300 million guarantee it agreed to pay New Jersey in the event it failed to build its first wind farm off the state’s coast.

Last Tuesday, the Danish firm scrapped its Ocean Wind I and II projects in southern New Jersey, saying the projects were no longer financially feasible. The company cited supply chain issues, inflation and a failure to gain enough government tax credits.

The next day, Orsted wrote to the New Jersey Board of Public Utilities, saying it was withdrawing from an agreement it signed with the state under which it would forfeit the money if it did not build Ocean Wind I.

Read the full article at the Associated Press

Ørsted pulls out of two big US offshore wind power projects

November 6, 2023 — Offshore wind developer Ørsted said it is pulling out of its Ocean Wind 1 and Ocean Wind 2 projects off the coast of the U.S. state of New Jersey.

Ørsted Group Executive Vice President and CEO Americas David Hardy cited escalated financial difficulties and supply chain issues for the move, after the Danish company’s board of directors announced the decision at the start of an earnings call.

Read the full article at SeafoodSource

Offshore Wind Firm Cancels N.J. Projects, as Industry’s Prospects Dim

November 2, 2023 — Plans to build two wind farms off the coast of New Jersey were scrapped, the company behind them said on Wednesday, a blow to the state’s efforts to cut greenhouse gas emissions and the latest shakeout in the U.S. wind industry.

The move, which will force Orsted, a Danish company, to write off as much as $5.6 billion, will crimp the Biden administration’s plans to make the wind industry a critical component of plans to reduce greenhouse gas emissions. High inflation and soaring interest rates are making planned projects that looked like winners several years ago no longer profitable.

“The world has in many ways, from a macroeconomic and industry point of view, turned upside down,” Mads Nipper, Orsted’s chief executive, said on a call with reporters on Wednesday.

The two projects, known as Ocean Wind 1 and 2, were destined to provide green energy to New Jersey. They were strongly backed by the state’s governor, Phil Murphy, a Democrat with national ambitions who stresses his environmental credentials but who has lately drawn scorn for falling short in combating climate change. On Wednesday he suggested that Orsted was a dishonest broker and insisted that the “future of offshore wind” along the state’s 130-mile coastline remained strong.

Mr. Nipper said Orsted thought that losses on the New Jersey projects would rise over time, so “the only sensible thing is to draw a line in the sand.”

Overall, the Biden administration wants to install 30 gigawatts of wind power in the United States by 2030, and officials in New Jersey had been aiming to produce 11 gigawatts by 2040.

Read the full article at the New York Times

Offshore wind company cancels project in N.J. Now what?

October 2, 2023 — Danish global offshore wind developer Orsted’s abrupt announcement this week that it is abandoning both of its massive projects planned off the New Jersey coast is a stinging blow to Gov. Phil Murphy’s ambitious goal of addressing climate change that threatens the state’s coast.

The company’s announcement Tuesday night was akin to abruptly snatching away key pieces of the state’s renewable energy puzzle. As of Wednesday, it was unclear how leaders would fill that void.

However, one key piece does remain in place: Atlantic Shores, the largest single wind farm yet approved by the New Jersey Board of Public Utilities (BPU).

Orsted in its earnings statement cited economic headwinds as the reason.

“Macroeconomic factors have changed dramatically over a short period of time, with high inflation, rising interest rates, and supply chain bottlenecks impacting our long-term capital investments,” said David Hardy, group executive vice president and CEO Americas at Orsted. “As a result, we have no choice but to cease development of Ocean Wind 1 and Ocean Wind 2.”

Hardy said the company was disappointed and thanked Murphy and other state leaders who tried to kick-start the industry in the state, hoping to make it a hub for offshore wind in the Northeast.

‘Outrageous’

Murphy, however, was having none of it. His administration took significant political heat in backing recent legislation allowing Orsted to take federal renewable energy credits that initially state law allowed to go only to ratepayers.

“Today’s decision by Orsted to abandon its commitments to New Jersey is outrageous and calls into question the company’s credibility and competence,” the governor said in a statement. “As recently as several weeks ago, the company made public statements regarding the viability and progress of the Ocean Wind 1 project.”

Murphy said his administration is looking “to review all legal rights and remedies and to take all necessary steps to ensure that Orsted fully and immediately honors its obligations.”

State officials who backed offshore wind are “upset, frustrated, and disappointed,” said a senior administration official, who called Orsted’s decision a “setback” in the state’s aggressive goal of obtaining 100% clean energy by 2035. The official said the administration is proceeding with offshore wind because “it’s too important to our economic future. It’s too important for our environmental and energy needs.”

It could take time for the state to find, and approve, a new developer to replace the 2.2 gigawatts of energy that would have been generated by Orsted’s Ocean Wind 1 and 2 projects — enough to have powered about 1 million homes.

Read the full article at the Philadelphia Inquirer 

NEW JERSEY: Ørsted pulls plug on New Jersey offshore wind projects

November 2, 2023 — New Jersey’s leaders are blasting a decision by a Danish energy company to back away from two major offshore wind projects off the state’s coastline.

In a statement issued Tuesday, Ørsted announced that it is scrapping two large offshore wind power projects off the coast of New Jersey, delivering a major blow to the state’s clean energy plans and Gov. Phil Murphy’s push to put the coastal state at the forefront of the nation’s nascent offshore wind industry.

Murphy ripped the company’s decision to walk away from the projects, calling it “outrageous” and saying it “calls into question the company’s credibility and competence.”

“As recently as several weeks ago, the company made public statements regarding the viability and progress of the Ocean Wind 1 project,” he said.

Murphy said a provision of the company’s development agreement requires it to pay New Jersey $300 million to support the offshore wind sector if the projects don’t proceed.

“I have directed my administration to review all legal rights and remedies and to take all necessary steps to ensure that Orsted fully and immediately honors its obligations,” he said.

Read the full article at the Center Square

U.S. offshore wind sector ‘fundamentally broken’ – BP exec

November 1, 2023 — BP’s renewables boss said on Wednesday the U.S. offshore wind industry is “fundamentally broken” as BP and its partner Equinor (EQNR.OL) study options to develop huge projects off the coast of New York after writing down $840 million of their value.

The offshore wind industry, one of the fastest growing energy sectors, has recently suffered a string of major setbacks due to equipment reliability issues, supply chain problems and sharp cost increases.

Orsted (ORSTED.CO), the world’s largest offshore wind developer, on Wednesday flagged writedowns of up to $5.6 billion after halting the development of U.S. offshore wind projects.

Anja-Isabel Dotzenrath, BP’s head of gas and low carbon, said that problems in the United States included permitting, the time lag between signing power purchase agreements and projects being built and a lack of inflationary adjustment mechanisms

Read the full article at Reuters

Orsted hit by up to $5.6 billion impairment on halted US projects

November 1, 2023 — Renewable energy firm Orsted (ORSTED.CO) on Wednesday halted the development of two U.S. offshore wind projects and said related impairments had surged above $5 billion, as the industry grapples with supply chain delays and higher costs.

Orsted, the world’s largest offshore wind developer, said it would stop developing its 2,248-megawatt (MW) Ocean Wind 1 and 2 projects in New Jersey. Related impairments could amount to as much as 39.4 billion Danish crowns ($5.58 billion).

Its stock plunged as much as 22% to a six year low of 265 crowns.

The offshore wind industry has found itself in a perfect storm of rising inflation, interest rate hikes and supply chain delays, casting doubt on plans by U.S. President Joe Biden and several states to use offshore wind to replace fossil fuels in energy production to fight climate change.

On Tuesday, energy major BP (BP.L) booked a third-quarter writedown of $540 million on wind projects after officials in New York state rejected a request for better terms to reflect what BP called “inflationary pressures and permitting delays”.

Read the full article at Reuters

Ørsted resumes off-shore survey for wind farm

September 10, 2023 — Ørsted, a clean energy company, will conduct offshore geophysical surveys in Delaware this Fall in support of Skipjack Wind’s development.

Skipjack Wind is a 966-megawatt offshore wind farm that is planned to power nearly 300,000 homes in the region. It’s important to note however that there is no site at the moment for an interconnection facility that would bring cables on shore. An onshore site is necessary before the project can come to fruition. Past proposed interconnection facility sites included Bethany Beach and Fenwick Island State Park, but nothing has been finalized. The latter was struck down after massive public opposition.

The US-flagged R/V Shackleford will conduct high-resolution geophysical surveys in the nearshore ocean environment to approximately 6 miles off Delaware’s coast. The purpose is to collect data about the seafloor and the geology beneath it, and to identify potential archaeological resources and debris left by other ocean users.

US approves major Rhode Island offshore wind farm

August 23, 2023 — The U.S. Interior Department on Tuesday approved the construction of a 704 megawatt (MW) wind farm off the coast of Rhode Island, the fourth offshore wind project the agency has greenlighted as the Biden administration targets bringing 30 gigawatts of offshore wind power online by 2030.

The Revolution Wind project off Point Judith, Rhode Island, could power nearly 250,000 homes and create 1,200 local jobs during the construction phase, the Interior Department said.

Owned by wind energy developers Orsted (ORSTED.CO) and Eversource (ES.N), the project includes up to 79 possible locations for the installation of 65 wind turbines and two offshore substations.

Read the full story at Reuters