Nov. 1 (UPI) — Danish energy company Orsted announced Tuesday that it has canceled two wind energy projects that were planned for New Jersey.
The projects, Ocean Wind 1 and 2, were intended to be built about 15 miles off the coast of southern New Jersey as part of the Biden administration’s efforts to promote clean energy.
The company cited supply-chain factors as the main reason for the projects being canceled.
“This is a consequence of additional supplier delays further impacting the project schedule and leading to an additional significant project delay. In addition, Orsted has updated its view on certain assumptions, including tax credit monetization and the timing and likelihood of final construction permit,” Orsted said in a statement Tuesday.
Orsted leadership said the company remains committed to the goal of creating renewable energy for U.S. markets.
“We are extremely disappointed to announce that we are ceasing the development of Ocean Wind 1 and 2. We firmly believe the U.S. needs offshore wind to achieve its carbon emissions reduction ambition, and we remain committed to the US renewables market and truly value the efforts by the US government to support the build-up of the US offshore wind industry,” said Orsted CEO Mads Nipper.
New Jersey Gov. Phil Murphy expressed disappointment in Orsted’s decision, saying it “calls into question the company’s credibility and competence.”
Murphy said the company recently had indicated it was prepared to move forward with the project.
“As recently as several weeks ago, the company made public statements regarding the viability and progress of the Ocean Wind 1 project,” Murphy said.
Murphy’s administration tried to create a financial incentive for the Ocean Wind projects by passing a law that would have allowed Orsted to keep tax incentives that were initially intended to offset consumer costs.
Murphy said he has directed his administration “to review all legal rights and remedies and to take all necessary steps to ensure that Orsted fully and immediately honors its obligations.”
The decision to cease the projects comes as the Biden administration this week announced the approval of the largest offshore wind project to date.
“The Biden-Harris administration today announced its approval of the Coastal Virginia Offshore Wind (CVOW) commercial project — the fifth approval of a commercial-scale offshore wind energy project under President Biden’s leadership,” the Bureau of Ocean Energy Management said in a press release Tuesday.
