The Biden administration on Wednesday approved Orsted A/S’s Ocean Wind 1 project, setting the stage for installation of as many as 98 turbines in waters off New Jersey over the opposition of some local residents.
The approval represents the third commercial-scale project of its kind in federal waters to win the U.S. government’s backing — all under President Joe Biden — and another step toward his goal of installing 30 gigawatts of offshore wind power by the end of the decade.
Interior Secretary Deb Haaland called the authorization “another milestone in our efforts to create good-paying union jobs while combating climate change and powering our nation.”
Under the Interior Department’s approval, as many as 98 turbines and three offshore substations could be installed about 13 nautical miles southeast of Atlantic City, with power cables coming ashore in Ocean County and Cape May County. According to the Bureau of Ocean Energy Management, the project is estimated to have a generating capacity of 1.1 gigawatts, capable of powering more than 380,000 homes.
The authorization makes Ocean Wind 1 the second Orsted project of its kind approved in U.S. waters. The Danish developer is already building the South Fork wind farm near Rhode Island in a joint venture with Massachusetts-based utility Eversource Energy. Work is also underway on the Vineyard Wind LLC project near Martha’s Vineyard, which won Interior Department approval in May 2021.
White House National Climate Adviser Ali Zaidi said the approval is part of a “massive expansion in clean energy construction.” “Thanks to President Biden’s leadership, the U.S. will keep seizing opportunities for offshore wind and other clean energy technologies, strengthening our energy security and advancing our climate goals, all while creating good-paying jobs up and down the manufacturing supply chain,” Zaidi said in an emailed statement.
Ocean Wind 1 had been a joint partnership with Public Service Enterprise Group. But Orsted bought out the energy supplier’s 25% equity stake in the venture earlier this year, after PSEG Chief Executive Ralph LaRossa told investors the company was reviewing the project’s costs.
Developers have planned more than a dozen wind projects in U.S. federal waters, as they rush to take advantage of tax credits expanded in last year’s climate law and a wave of state interest in new clean energy supplies. However, developers are also confronting a host of challenges, including local opposition and higher costs stoked by inflation. BloombergNEF estimates the price of subsidized U.S. offshore wind projects has climbed to $114.20 per megawatt-hour in 2023 — up 48% from 2021.
