The news that Danish wind giant Orsted is halting development on its two offshore projects in New Jersey comes at a politically tricky time for Democrats in the state as they scramble to retain their narrow majorities in Tuesday’s elections, which will determine the future of every seat in New Jersey’s General Assembly.
The two planned Orsted projects, Ocean 1 and Ocean 2, would have brought a combined 2,248 megawatts of offshore wind energy to the state. Both had been seen as crucial to helping achieve Gov. Phil Murphy’s (D-NJ) ambitious target of reaching 100% clean energy by 2035.
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Wind developers in the United States have faced a cascading series of setbacks in recent months caused by poorly negotiated power purchase agreements, an underdeveloped offshore supply chain, and high project costs that have ballooned amid rising global demand and unanticipated global crises.
But unlike other projects in the U.S., Orsted’s cancellation threatens to carry real political implications in the Garden State, where Democrats are fighting to hold on to their narrow majority in the state Senate and Assembly in this week’s election.
On Tuesday, voters will head to the ballot to decide the fate of all 120 seats in the state Assembly and the Senate, where Democrats hold majorities of 46-34 and 25-15, respectively.
And the timing of Orsted’s announcement all but guarantees the topic will be fresh in voters’ heads as they head to the ballot boxes.
On Twitter, Assembly Republicans mocked the news, including a video titled “In Memoriam: Ocean Wind 1 & 2,” which featured a mashup of news from the offshore wind projects against a botched flute rendition of the theme song from Titanic.
U.S. Reps. Chris Smith (R-NJ) and Jeff Van Drew (R-NJ) also praised the news of Orsted’s cancellations.
Van Drew, who represents southern New Jersey, tweeted that he was “thrilled to see that Orsted has decided to pack up its offshore wind scam and leave South Jersey’s beautiful coasts alone.”
And Smith, a Republican whose district includes parts of the Jersey Shore, told the Washington Examiner on Monday that Orsted’s decision to halt development on its projects offshore New Jersey “underscores that Gov. Murphy’s radical plan to install 3,400 wind turbines along the Jersey Shore is reckless and economically flawed — regardless of how much taxpayer money he throws at foreign corporations like Orsted.”
Smith also weighed in on potential impacts to the state elections. “Instead of using the coercive power of the state to advance these projects, [Murphy] and the Democrats in Trenton should be listening to the serious concerns that I and others have raised regarding the deleterious impacts these projects will have on our local economy, commercial and recreational fishing, tourism, the health of the marine ecosystem, and commercial and military navigational safety,” he said.
“We’re close enough to the target,” Alexandra Wilkes, a spokeswoman for the New Jersey GOP, told the New York Times about winning a majority in Tuesday’s elections but noted, “We have to hit the darts right every time.”
Many have acknowledged the setbacks that commercial-scale developers face in the U.S., which all but ensure the Biden administration’s ambitious target of bringing online 30 GW offshore wind by 2030 will be impossible to reach. It also severely threatens the goals of Murphy, whose administration has targeted an even more ambitious timeline for clean power development.
Murphy blasted Orsted’s decision to halt development on the Ocean 1 and 2 projects as “outrageous,” saying in a statement that the decision called into question both the company’s credibility and its competence as it looks to bring online two remaining projects in Rhode Island and New York.
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He said his administration will make sure Orsted follows through on its earlier commitment to pay the state $300 million for failing to follow through on the projects and is reviewing “all legal rights and remedies and to take all necessary steps to ensure that Orsted fully and immediately honors its obligations.”
Still, Murphy vowed to continue pursuing new offshore projects in the state, saying that while Orsted’s cancellation was a setback, “the future of offshore wind in New Jersey remains strong.”
