Trump Administration halts all offshore wind projects

The Trump administration on Monday halted the construction of all U.S. offshore wind projects, a sweeping move aimed at hobbling one of the president’s least favorite industries.

The Interior Department said it has paused the federal leases for five projects in the works from Massachusetts to Virginia “due to national security risks identified by the Department of War in recently completed classified reports.” It is the most significant action the administration has taken thus far against the burgeoning U.S. business.

“Today’s action addresses emerging national security risks, including the rapid evolution of the relevant adversary technologies, and the vulnerabilities created by large-scale offshore wind projects with proximity near our East Coast population centers,” Interior Secretary Doug Burgum said.

The decision affects Vineyard Wind 1 off Martha’s Vineyard; Revolution Wind, which is intended to deliver power to Rhode Island and Connecticut; Coastal Virginia Offshore Wind; and Sunrise Wind and Empire Wind 1, off the coast of New York.

Shares in Danish energy company Orsted, which is leading two of the projects, fell more than 11% on the news. Dominion Energy, the lead developer of the Coastal Virginia project, fell more than 5% and was the worst performer in the S&P 500. 

Barclays analysts said in a note that it appeared that Dominion “was not aware of this potential stoppage as the boat left to install turbines yesterday.”

Dominion called the project “essential for American national security” and for meeting Virginia’s rapidly growing electricity demand. 

“This growth is driven by the need to provide reliable power to many of America’s most important war fighting installations, the world’s largest warship manufacturer, and the largest concentration of data centers on the planet as well as the leading edge of the AI revolution,” it said in a statement.

The projects were expected to deliver nearly 6 gigawatts of electricity, according to the Oceantic Network, an offshore wind industry group. That would be roughly enough to power Manhattan. 

Liz Burdock, the group’s chief executive, called the halt “another veiled attempt to hide the fact that the president doesn’t like offshore wind—a well-documented preference that is increasing energy costs for millions of Americans, deterring U.S. investment, and putting thousands out of work indefinitely.”

The Center for American Progress, a progressive policy institute, estimated in August that there were about 12,000 direct jobs and 5,000 indirect jobs in the offshore wind industry tied to projects that were in danger due to the Trump administration’s attack on wind power.

Erik Milito, president of the National Ocean Industries Association, a trade group for the offshore oil, gas and wind industries, urged the administration to lift the pause and said the projects have already undergone a rigorous regulatory review process by the Defense Department. President Trump recently renamed the department as the War Department.

Trump’s battle against the offshore wind industry has escalated since he returned to office. His first wave of executive orders included a pause for federal permits and leasing for wind projects on land and at sea, which plunged the industry into months of uncertainty.

“We aren’t going to do the wind thing,” Trump told his supporters Jan. 20, twirling a finger in a circle to indicate the rotation of a turbine blade. “Big ugly windmills, they ruin your neighborhood.”

The administration halted Empire Wind in the spring but later allowed it to restart construction following a negotiation between New York Gov. Kathy Hochul and the administration.

In August, it halted Revolution Wind, a decision that shocked the industry because that project is nearly complete. The halt left workers in limbo on the water, before a federal judge in September said they could resume construction.

The offshore wind business had been financially troubled before the Trump administration. Wages soared after the pandemic. Higher interest rates drove up the cost of borrowing for billion-dollar developments, and the industry encountered a global shortage of vessels needed to haul turbines and their foundations from ports to job sites in the ocean.