The two firms behind a major offshore wind project decided to cancel a contract to supply power from the development on Wednesday, dealing a major blow to President Joe Biden’s massive green energy agenda.
Equinor and British Petroleum (BP), the firms working in a joint venture to construct the enormous Empire Wind 2 offshore wind farm, canceled a contract with New York state to sell power generated by the project, citing inflationary pressures, high interest rates and supply chain problems, Equinor announced. The cancellation stands as the latest sign of trouble for the offshore wind industry, which the Biden administration is counting on to produce enough energy to power 10 million American homes for one year by 2030.
“Commercial viability is fundamental for ambitious projects of this size and scale. The Empire Wind 2 decision provides the opportunity to reset and develop a stronger and more robust project going forward,” Molly Morris, president of Equinor Renewables Americas, said in a statement. “We will continue to closely engage our many community partners across the state. As evidenced by the progress at the South Brooklyn Marine Terminal, our offshore wind activity is ready to generate union jobs and significant economic activity in New York.” (RELATED: Offshore Wind Farms Are Killing Whales ‘In Numbers Never Seen Before,’ Trump Says)
Biden’s Climate Bill Boosted An Offshore Wind Giant, But His Economy Brought It To The Brink https://t.co/AF7SPT2FNu
— Daily Caller (@DailyCaller) November 3, 2023
The two companies had signaled that their projects were facing financial troubles, signing onto a petition to New York officials in September 2023 seeking to renegotiate their contracts to account for economic problems that are dogging the wider offshore wind industry. The contract’s cancellation does not necessarily mean that the project is permanently terminated, but the firms will have to renegotiate the development at a higher price from the state in order to get back on track, according to Reuters.
“Politicians may try to resuscitate it, but this extends offshore wind’s losing streak, which is quite impressive,” Dan Kish, a senior research fellow for the Institute for Energy Research, told the Daily Caller News Foundation regarding the project and its future prospects. “Even with Biden’s Green New Deal slathering cash all over these things, they can’t seem to grease the skids enough to make these things work.”
The problems facing offshore wind are widespread and severe enough that several energy policy experts previously told the DCNF that they expect the federal government to step in to effectively bail the industry out.
In October, Ørsted, the world’s largest offshore wind developer, pulled the plug on two major projects off the New Jersey coast, and several other developers have paid hefty fines to get out of agreements to sell power from their projects in other states.
A large proportion of the projected power output from industrial-scale offshore wind projects is under considerable financial duress, and Biden’s 2030 goal appears to be firmly out of reach at this point in time, according to Reuters.
The White House, the Department of Energy and the office of Democratic New York Gov. Kathy Hochul did not respond immediately to requests for comment. BP referred the DCNF to Equinor when contacted for comment, and Equinor did not respond immediately to the inquiry.
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