Stunning defeat for Murphy — NJ offshore wind projects cancelled

🔴 Developer cancels investment in offshore wind

🔴 Two New Jersey projects have been scuttled

🔴 Gov. Murphy remains committed to wind power

In what amounts to a huge defeat of Gov. Phil Murphy's green energy agenda, Danish developer Orsted has canceled all wind project development off the coast of new Jersey.

Citing "supply chain challenges, project delays, and rising interest rates" company officials released a statement Tuesday night announcing they would "cease development of Ocean Wind 1 and Ocean Wind 2" off the coast of New Jersey.

It is a stunning setback for Murphy who committed $1 billion in tax credits to Orsted to keep the project afloat.

Orsted had committed $100 million in escrow funds to ensure the project was completed by 2025.

An infuriated Murphy blasted the company he had once so vigorously supported.

"Today’s decision by Orsted to abandon its commitments to New Jersey is outrageous and calls into question the company’s credibility and competence.” Murphy said.

The governor vowed to hold Orsted accountable. "I have directed my Administration to review all legal rights and remedies and to take all necessary steps to ensure that Orsted fully and immediately honors its obligations." Murphy said in a statement.

It is not yet clear how much of the money that Murphy funneled to Orsted will be clawed back for taxpayers.

Wind projects were fraught with controversy

While Murphy, legislative Democrats and environmentalists aggressively promoted the benefits of offshore wind projects, Republicans, members of the public and local government officials were equally opposed.

Shore towns expressed concerns about the impact to tourism.

Republicans worried about the cost and the potential impact to marine life.

But even support from key Democrats had begun to fade in recent months. New Jersey Senate President Nick Scutari and Assembly Speaker Craig Coughlin put out a statement questioning the state's commitment and the cost. They had suggested pausing development for more study of the impact.

Cheers from the GOP

Opponents of the controversial wind farm projects celebrated Orsted's decision to cancel the projects.

Rep. Jeff Van Drew said it amounted to David defeating Goliath and vowed to kill any future projects. Van drew said he will use this decision to "see to it that the remaining projects proposed off our Coast meet the same fate."

Sen. Declan O’Scanlon, Assemblywoman Victoria Flynn and Assemblyman Gerry Scharfenberger all called the cancellation an "I told you so" moment."

What happens next?

Gov. Murphy made it clear in his statement that his administration is not backing off wind energy as a core of his clean energy goals.

He said the Board of Public Utilities will "shortly announce two additional solicitations" related to future wind projects. Murphy insists interest from other companies in building those projects remains strong.

However, the mood in the legislature has changed since Murphy muscled through a billion dollars in incentives. It is unlikely that Speaker Coughlin and Senate President Scutari will rubber stamp any similar incentive program for another developer. That is especially true since it is not known how much, if any, taxpayer money will be recouped from the failed Orsted project.

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