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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

New Jersey residents challenge Orsted offshore wind farm’s $1 billion subsidy

July 31, 2023 — New Jersey residents have sued Danish renewable energy developer Orsted and the state over a tax break the company received to build a major offshore wind farm in the Atlantic, claiming the estimated $1 billion subsidy violates the state constitution.

New Jersey groups Defend Brigantine Beach and Protect our Coast NJ filed their lawsuit on Thursday in state court in Trenton. They claimed the law authorizing the tax break, signed earlier this month by Governor Phil Murphy, violates a provision of the state constitution that generally prohibits legislation that specifically favors a single, private entity.

The groups asked the court to invalidate the law, which they said created the tax break “for the singular purpose of protecting Orsted from commercial risk it voluntarily assumed” when it submitted bids to develop the project, known as Ocean Wind.

Orsted said on Friday it does not comment on pending litigation. The New Jersey attorney general’s office did not immediately respond to a request for comment.

Read the full article at Reuters

New Jersey State Senator Michael Testa claims ENGO hypocrisy on offshore wind and whales

May 19, 2023 — The following transcript is excerpted from an interview by New Jersey State Senator Michael Testa on Fox & Friends:

Fox & Friends: GOP lawmakers in New Jersey want an immediate stop to offshore wind projects over growing concern about a spike in whale deaths. Since December alone, 32 dead whales have washed up on beaches along the East Coast. Republican state senators are asking for a 30 to 60 day pause on construction to see if it helps. Michael Testa is one of them and he joins us now.

So who exactly are the groups or the people who would be opposing a 30 to 60 day, very sensible pause to see what’s going on with the whales?

Sen. Testa: Well, it seems to be Ørsted, who’s the company that wants to have the wind farms, as well as the Sierra Club and Greenpeace, which makes absolutely no sense to me because I always thought that those were the groups that were there to protect the whales and to create bumper stickers that say ‘save the whales.’ And I think that they’re being completely intellectually disingenuous here. We know that if this were an exploration for offshore oil drilling, that if one whale carcass were to wash up on one of New Jersey’s shores, they would be surrounding that carcass holding hands with, you know, tears streaming down their face, singing Kumbaya.

Fox & Friends: What is their explanation for not wanting to see an environmental impact on whales?

Sen. Testa: Well, their explanation is the reason that the whales and dolphins are washing up on our shores in record numbers is due to climate change. That’s why we need to rush to erect these massive wind farms, which, you know, quite frankly, a lot of people have now testified and believe are contributing to whales washing up on our shores in record numbers. But it’s always their cry. This is their mantra. This is climate change. And if you ever question their green energy agenda, you’re labelled a science denier, a climate change denier.

We also have to really question what the environmental impact is going to be to our commercial fishing industry as well as our recreational fishing industry and look, Cape May County, Atlantic County, Ocean County and Monmouth County, tourism is the lifeblood of their summer economy.What are these wind farms going to do if whales and dolphins continue to wash up on our shores?

We also don’t know what the erection of these massive wind farms [is] going to do to our ocean floor and what type of environmental long term environmental impact that is going to have on our oyster business, scallop business.

Watch the full interview here

Work has started on major offshore wind farm that would power Rhode Island. What to know.

May 2, 2023 — The developers of Rhode Island’s first utility-scale offshore wind farm are still waiting on approvals for the 704-megawatt project, but that’s not stopping them from starting work on pieces of it.

Ørsted and Eversource welcomed Gov. Dan McKee, the Rhode Island congressional delegation and other officials to the Port of Providence on Monday to mark the beginning of fabrication of some of the key components of the towering wind turbines that will be installed in the waters between Block Island and Martha’s Vineyard as part of Revolution Wind.

The companies set up shop a year and a half ago in the port, where they built a regional hub that is supplying parts to a host of wind farms planned off southern New England.

‘Jobs of the 21st century’

First up for the facility was the South Fork Wind Farm, a 130-megawatt, 12-turbine array already under construction that will help power Long Island. Now comes Revolution, the 65-turbine project that would deliver energy to Rhode Island and Connecticut. Sunrise Wind, an 880-megawatt proposal to also supply New York, is expected to follow. And, if all goes as planned, a second, even bigger phase of Revolution would come.

It’s all part of a long-term vision to not only generate cleaner sources of power to help meet the nation’s climate goals, but also position Rhode Island as a manufacturing base for offshore wind development.

Read the full story at the Cape Cod Times