Ørsted, the world’s leading offshore wind developer, announced that it has decided to stop working on two of its projects in New Jersey, Ocean Wind 1 and 2, in what one prominent environmental leader called “a gut punch for offshore wind.”
Instead, the Danish renewable energy giant will focus on its Revolution Wind project in Connecticut and Rhode Island.
Ørsted decided to stop working on the New Jersey wind farms because things are expensive right now and it’s hard to get the materials and people it needs.
The company still owns the land where the New Jersey wind farms would have been built, and it is thinking about what else it can do with it.
“Today’s decision by Ørsted to abandon its commitments to New Jersey is outrageous and calls into question the company’s credibility and competence,” said Gov. Phil Murphy. “As recently as several weeks ago, the company made public statements regarding the viability and progress of the Ocean Wind 1 project.”
Murphy noted the state had been working with Ørsted. Ocean Wind 1 was slated to be New Jersey’s first offshore wind farm when it came online in 2025. Construction was expected to begin in 2024.
The Murphy administration has vowed to press forward with other offshore wind projects despite calls for a pause by opponents, including Republican lawmakers who want an accounting of money spent on the project by Ørsted.
“Trenton Democrats wanted wind farms along the Jersey Shore so badly they didn’t care how much it cost New Jerseyans in higher electric bills,’’ said Senate Republican Leader Anthony Bucco. “We must realize that the fight over expensive wind farms and for an affordable energy future is not over yet.’’
Republicans typically have opposed clean energy, denying the existence of global warming and stalling efforts to transition away from industries that contribute to greenhouse gas emissions.
“This is undeniably a gut punch for offshore wind,’’ said Doug O’Malley, director of Environment New Jersey. “If we don’t move forward on offshore wind, we’d end up relying on fossil fuels. Offshore wind is bigger than one company. There are other projects.’’
The only remaining offshore wind project, which is expected to be operational in 2028, is Atlantic Shores, a partnership between New Shell Energies and EDF Renewables.
Four other projects are in the process of being selected in a third solicitation by the New Jersey Board of Public Utilities early next year.
Despite the resistance put up by Republicans, the two biggest federal clean energy incentives were enacted by GOP presidents.
The federal Investment Tax Credit (ITC) is a popular political punching bag. It provides a 30% tax credit on new solar installations. The ITC was first put in place as part of the Energy Policy Act of 2005 – during the Republican presidency of George Bush. It was improved and extended in 2006 and then again in 2008 as part of the Emergency Economic Stabilization Act, also while Bush was in office.
For wind, the main federal subsidy is the Production Tax Credit (PTC). This has a much longer history. It was initially put in place in 1992, under the elder President George H. W. Bush. It was extended and renewed in the decades since. Both wind and solar subsidies were extended by Democratic President Barack Obama. Both are on schedule to wind down in the next few years.
The polarized atmosphere in Washington has created a near-total unwillingness among Republicans to cooperate with Democrats in support of anything proposed by the Biden administration, lest they be demonized by right-wing media and the party’s activist base. A lack of honesty exacerbates this problem.
The Washington Post identified six House lawmakers —Kevin McCarthy, Steve Scalise, Cathy McMorris Rodgers, Bruce Westerman, Elise Stefanik, and Tom Emmer— who largely oppose government action to address climate change, even as their districts confront serious floods, droughts, heat waves, and other impacts.