US offshore wind perils continue for Ørsted with delay of Revolution Wind

After the New Jersey Board of Public Utilities (NJBPU) formally stopped Ørsted’s Ocean Wind One and Two projects, the Danish developer has been forced to delay another major project in the US.

Even though Ørsted decided to cease the development of its Ocean Wind One and Two late last year citing surging costs facing the global wind power industry as the main reasons, the New Jersey Board of Public Utilities formally vacated all orders that approved the two projects earlier this week.

On top of that, Ørsted pushed back the start of commercial operations at its 704MW Revolution Wind project off the coast of Rhode Island and Connecticut by a year, to 2026. According to the company’s second-quarter financial results, the delay would contribute to an impairment cost of around $472m.

To make it even more coincidental, the Revolution Wind FID was made around the same time as the decision to abandon Ocean Wind One and Two. Revolution Wind is owned 50-50 by Ørsted and Eversource.

The perils of the Danish company and the cancellation of the two US projects led them to cut 800 jobs and exit several markets in February. Ørsted said at the time that it would withdraw from markets in Norway, Spain, and Portugal and suspend dividend payments covering the 2023-2025 fiscal years in an attempt to recover.

Trouble does seem to compound for the firm as it also decided to abandon FlagshipONE, a project which was set to become Europe’s largest e-methanol plant for shipping fuel in 2025. The decision came nearly two years after the project’s FID and Ørsted cited slow market progress and an inability to sign long-term offtake contracts as the two main reasons for it.