Danish energy developer Orsted has made the decision to discontinue the development of the substantial 2,248-megawatt (MW) Ocean Wind 1 and Ocean Wind 2 offshore wind projects in the United States. This move is part of a broader assessment of the company's business activities in the U.S.
The decision to halt these projects was influenced by rapidly changing macroeconomic factors. Orsted cited the pronounced impact of supply chain bottlenecks and the escalation of interest rates as factors that have disrupted their long-term plans. The consequence of this decision is an impairment charge of €2.7 billion (DKr 19.9 billion).
David Hardy, the head of Orsted's U.S. operations, stated, “As a result, we have no choice but to cease development of Ocean Wind 1 and Ocean Wind 2. We are extremely disappointed to have to take this decision, particularly because New Jersey is poised to be a U.S. and global hub for offshore wind energy.”
The company intends to retain the seabed lease area associated with the ceased projects and will explore alternative options as part of an ongoing portfolio review.
Concurrently, Orsted has announced its final investment decision for the 704 MW Revolution Wind project, a collaborative effort with Eversource. Hardy emphasized the commitment to this project as a means of contributing to American energy generation and job creation. He expressed gratitude to the company's teams for their dedication in a challenging market environment.