ATLANTIC CITY, N.J. — Danish energy developer Orsted said Tuesday night it is scrapping two large offshore wind-power projects off the coast of New Jersey, adding uncertainty to a nascent industry the Biden administration and many state governments are counting on to help transition away from the burning of planet-warming fossil fuels.
Orsted ORSTED, +1.80% CEO Mads Nipper said in a statement the company was disappointed to be halting the projects because it believes the United States needs wind power to reduce carbon emissions. Orsted stands to lose a $100 million guarantee it posted with New Jersey earlier this month that it would build Ocean Wind I by the end of 2025. That money could be returned to ratepayers.
Orsted, the world’s largest wind energy developer, warned in August that it might walk away from one or both of its New Jersey projects, which it said needed more financial subsidies beyond a tax break approved by the state that would have let the company keep as much as $1 million in tax credits that otherwise would have had to be returned to electricity ratepayers. headtopics.com
Murphy, who took significant political heat for the tax break, reacted angrily to Orsted’s decision to walk away from New Jersey. He noted that Orsted was required to put up an additional $200 million to benefit the state’s offshore wind industry, and said he would make sure the company abides by that obligation.
The decision was the latest in a series of setbacks for the offshore wind industry in the northeast. Two weeks ago, New York regulators rejected a request from companies for larger subsidies to complete large-scale wind, solar and offshore wind projects, saying the companies were expected to to abide by the terms of their deals with the state. headtopics.com
Offshore wind in general, and particularly in New Jersey, has faced growing opposition, both politically — mostly from Republicans — and from residents concerned about impacts on the environment, increased costs and the impairment of views of the ocean horizon.