Written by
Nick Blenkey
On August 29, Danish power large Ørsted warned that it’d write off as a lot as $2.12 billion due to points with its three U.S. east coat offshore wind tasks, Ocean Wind 1, Dawn Wind, and Revolution Wind. The corporate cited opposed impacts referring to the availability chain, lack of favorable progress in Funding Tax Credit score (ITC) steering, and elevated rates of interest. On October 31, the opposite shoe dropped. Ørsted mentioned that, following a choice by its Board of Administrators, Ørsted will stop growth of the New Jersey offshore wind tasks Ocean Wind 1 and Ocean Wind 2 .. Nevertheless it has taken remaining funding choice (FID) that may see it go forward on the Revolution Wind undertaking, offshore Rhode Island.
Ocean Wind 1 was set to turn out to be New Jersey’s first offshore wind farm. Again in July, New Jersey Gov. Phil Murphy signed into legislation a invoice giving Ørsted a hefty tax break on the undertaking.
“Macroeconomic elements have modified dramatically over a brief time frame, with excessive inflation, rising rates of interest, and provide chain bottlenecks impacting our long-term capital investments,” mentioned David Hardy, Group EVP and CEO Americas at Ørsted. “Consequently, we have now no selection however to stop growth of Ocean Wind 1 and Ocean Wind 2. We’re extraordinarily dissatisfied to should take this choice, notably as a result of New Jersey is poised to be a U.S. and international hub for offshore wind power. I wish to thank Governor Murphy and N.J. state and native leaders who helped assist these tasks and proceed to guide the area in growing American renewable power and jobs.”
Ørsted famous thar Ocean Wind 1 and a couple of. have skilled important impacts from macroeconomic elements, together with excessive inflation, rising rates of interest and provide chain constraints, notably a vessel delay on Ocean Wind 1 that significantly impacted undertaking timing. Nevertheless, yjt firm intends to retain the seabed lease space and take into account one of the best choices as a part of the continued portfolio assessment.
Ørsted says the choice to stop growth of Ocean Wind 1 and Ocean Wind 2 is a part of an ongoing assessment of its U.S. offshore wind portfolio with an replace deliberate for its for its fourth quarter 2023 outcomes announcement. The corporate says it stays dedicated to the U.S. renewable power trade, together with offshore wind and land-based applied sciences.
The board determined at this time to take FID on Revolution Wind, a 50/50 three way partnership with Eversource.
“With our remaining funding choice, we’re solidifying our dedication to constructing our second commercial-scale offshore wind farm in the USA, serving to to ship extra American power and American jobs,” Hardy added. “I wish to thank our Ørsted workers who helped obtain FID for Revolution, in addition to our group at South Fork Wind constructing New York’s first offshore wind farm, our New Jersey group that labored tirelessly to advance these tasks, and our land-based group delivering throughout our portfolio. As we handle and ship in a difficult market, our group of specialists units itself aside.”
