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Archive for the ‘Wind Energy’ Category

Ørsted’s troubles and Atlantic wind decommissioning

Posted in decommissioning, Offshore Wind, tagged , , , , , , , , on August 14, 2025| 1 Comment »

Ørsted’s stock price plummeted on Monday following the announcement of a $9.4 billion rights issue to fund the Sunrise Wind project. The share price has remained depressed (chart below).

Also, although Ørsted attributes its financial woes to the change in US policies, it’s apparent in the second chart (5 year trend) that the decline in Ørsted’s valuation has been ongoing since 2021.

In March, Fitch downgraded Ørsted’s rating to BBB from BBB+, and its subordinated rating to BB+ from BBB-. Further downgrades would seem to be a distinct possibility.

Meanwhile, decommissioning financing for the 3 Ørsted projects under construction in the US Atlantic is far from assured:

  • Revolution Wind: As they did for Vineyard Wind, BOEM approved Ørsted’s request to defer full decommissioning financial assurance until 15 years after the beginning of construction (see attached letter). This approval was prior to the Renewable Energy Modernization Rule (effective June 29, 2024), which eliminated the need for such waivers.
  • Sunrise Wind: Ørsted is now solely responsible for funding and constructing this project given the company’s failure to find investment partners. Presumably, decommissioning financial assurance was not required given BOEM’s latitude under the so-called “Modernization Rule.”
  • South Fork Wind: As is the case with Sunrise Wind, BOEM presumably allowed Ørsted to defer financial assurance for decommissioning as permitted by the “Modernization Rule.”

According to Ørsted, almost 70% of the turbines are installed at Revolution Wind and the first foundations have been installed at Sunrise Wind. South Fork Wind, 12 turbines and an offshore substation, is complete.

Given Ørsted’s strained finances, will BOEM now opt to require decommissioning assurance as provided for in 30 CFR § 585.517?

Ørsted’s situation is atypical in that the Danish government owns a majority (50.1%) stake in the company and Equinor, which is 2/3 Norwegian govt owned, holds a 9.8% stake. How will government ownership factor into BOEM decisions regarding decommissioning assurance? Note that Norwegian govt lobbying may have been one of the factors influencing the decision to allow the resumption of construction on Equinor’s Empire Wind project.

Meanwhile, two Danish opposition parties are calling for the state to relinquish its ownership stake in Ørsted.

REV_0486_Fin Assur Decom Departure Appr LtrDownload

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Offshore wind: End of the decommissioning free ride?

Posted in decommissioning, Offshore Wind, Regulation, tagged , , , , on August 11, 2025| Leave a Comment »

The Dept. of the Interior is reviewing offshore wind regulations including “the Renewable Energy Modernization Rule, as well as financial assurance requirements and decommissioning cost estimates for offshore wind projects…”

Concerns about offshore wind financial assurance were first raised on this blog in response to a precedent setting waiver of the “pay as you build” requirement. Vineyard Wind was authorized to defer providing the full amount of required decommissioning financial assurance until year 15 of actual operations.  The waiver request, which had been denied in 2017, was resubmitted in 2021 and approved. This questionable decision was consistent with the administration’s enthusiastic promotion of accelerated offshore wind development.

BOEM’s streamlining rule codified the deferred financial assurance option. The rule authorizes the transfer of decommissioning risks from developers to taxpayers and consumers by (1) not requiring any additional supplemental financial assurance at the Construction and Operations Plan (COP) approval stage, (2) not requiring supplemental assurance at the installation stage, and (3) providing for incremental supplemental assurance post-installation (e.g. for Vineyard Wind, the full amount is not due until 15 years after installation). See the rule’s previous and current language in the table below (emphasis added).

30 CFR 585.516 – What are the financial assurance requirements for each stage of my commercial lease?

financial assurance required before BOEM will: language prior to 4/24/2024 “modernization” rulecurrent language
Approve your COPA supplemental bond or other financial assurance, in an amount determined by BOEM based on the complexity, number, and location of all facilities involved in your planned activities and commercial operation. The supplemental financial assurance requirement is in addition to your lease-specific bond and, if applicable, the previous supplement associated with SAP approval.There is no supplemental bond requirement at the COP approval stage.
Allow you to install facilities approved in your COPA decommissioning bond or other financial assurance, in an amount determined by BOEM based on anticipated decommissioning costs. BOEM will allow you to provide your financial assurance for decommissioning in accordance with the number of facilities installed or being installed. BOEM must approve the schedule for providing the appropriate financial assurance coverage.A supplemental bond or other authorized financial assurance in an amount determined by BOEM based on anticipated decommissioning costs of the proposed facilities. If you propose to incrementally fund your financial assurance instrument, BOEM must approve the schedule for providing the appropriate financial assurance.

The current financial assurance language is fuzzy enough that BOEM could deny deferred funding requests and require full financial assurance at the time facilities are installed. However, revising the language to clearly require that assurance be fully demonstrated prior to installation would provide clarity and eliminate the deferral option going forward.

The more difficult challenge may be adjusting financial assurance requirements for the projects already under construction. It’s also important to ensure that parent corporations are not shielded from decommissioning and other liability risks.

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The winds of change! 😉

Posted in energy policy, Offshore Energy - General, Offshore Wind, Uncategorized, tagged , , , , on August 8, 2025| Leave a Comment »

2023 vs. 2025: Not so subtle changes

BOEM tweet (12/8/2023): Offshore wind is a once-in-a-generation opportunity to build a new clean energy industry, tackle the climate crisis, and create good-paying jobs, while ensuring economic opportunities for all communities.
BOEM tweet (7/31/2025): America’s offshore energy resources are powering the nation. In FY2024 that looks like 668M barrels of oil, 700B cubic feet of natural gas
BSEE 2023 logo
BSEE 2025 logo

BTW, the new BSEE logo appears to have been influenced by the masterpiece Rig at Sunset 👍 😉

Rig at Sunset

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Dept. of the Interior is reconsidering approval of US Wind Construction & Operations Plan

Posted in energy policy, Offshore Wind, Regulation, tagged , , , , , on August 7, 2025| Leave a Comment »

A new court filing (attached) informs that the Dept. of the Interior is reconsidering the Construction & Operations Plan (COP) approval for US Wind’s Maryland Offshore Wind (“MarWin”) Project (maps above). That approval is the subject of litigation filed by Ocean City MD and others.

The key section of the Federal government’s filing is pasted below.

  1. An extension in this case is necessary as Interior intends to reconsider its COP approval and move in the District of Maryland—the first-filed case—for voluntary remand of that agency action. See, e.g., Util. Solid Waste Activities Grp. v. EPA, 901 F.3d 414, 436 (D.C.Cir. 2018) (recognizing that administrative agencies have the authority to reconsider their decisions). The outcome of Interior’s reconsideration has the potential to affect the Plaintiff’s claims in this case.
Maryland Offshore WindDownload

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Nantucket Current opinion piece challenges Select Board rhetoric

Posted in Offshore Wind, energy policy, climate, tagged , , , , , on August 6, 2025| Leave a Comment »

Victoria Bonnet’s piece in the Nantucket Current challenges certain assertions made at the Select Board’s July 29 press conference. Key points:

“The government documents for ALL the Atlantic projects make it clear that there will be no benefit to climate change from implementing wide scale offshore wind.”

“And how is it possible that an attorney representing an island that is receiving the full brunt of the environmental impacts from this massive industrial project is lecturing the press that historic preservation can co-exist with offshore wind? The sight of just the first 40 towers from Vineyard Wind makes it clear they can’t.”

“Blindly following public relations statements about offshore wind as a critical solution to climate change that must be implemented immediately is how we got here in the first place. It has become clear that Nantucket receives no benefits from, but is significantly harmed by, Vineyard Wind. Our Select Board’s role should not be to advocate for any energy source that harms Nantucket.”

“Dawn Hill, a signatory to the Good Neighbor Agreement and the current Select Board Chair, was a bright spot in the meeting. Her acknowledgment that the project is way more impactful than communicated at the time the Good Neighbor Agreement was signed gives hope that more rational thinking and action is on the way.“

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Denmark relies heavily on imported power

Posted in climate, energy policy, Offshore Wind, tagged , , , on August 6, 2025| Leave a Comment »

As indicated in the Jens Christiansen graphic above, Denmark’s net imports exceeded 80% of demand several times in July. Per Jens, a Danish physicist, “this is the downside of being a wind leader we have to talk about.”

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MV Times raises more Vineyard Wind transparency questions

Posted in decommissioning, energy policy, Offshore Wind, Regulation, tagged , , , , , on August 4, 2025| Leave a Comment »

MV Times -blade replacement continues

MV Times: “The recent site visit raised questions on the production of the wind farm. The Times has been able to neither verify the report independently nor confirm disparities between visuals on the ground and the Iberdrola report.”

  • Avangrid, an Iberdrola subsidiary and one of Vineyard Wind’s developers, reported that 17 out of 62 turbines were currently sending power to the Massachusetts grid.
  • The MV Times counted between five and nine turbines spinning at different points, and for different intervals, in their two hour visit.
  • BOE comment: Although there are many possible reasons for this discrepancy, it’s reasonable to question the absence of turbine output data. Developers assert that generator specific data are sensitive and could have market implications. However, these turbines are operating on public lands and were in part publicly funded. Output data and other performance metrics clearly have policy implications.
  • Note that Iberdrola “expect[s] no impact from new federal budget legislation, as it doesn’t impact 1,000 megawatts under construction.”

An MV Times photo of a Vineyard Wind substation is pasted below. These substations are large structures. Per the Construction and Operations Plan (COP) for Vineyard Wind, the topsides for a conventional electrical service platform (ESP) (also known as an offshore substation or OSS) are 45 x 70 x 38 m, which is larger in surface area than a typical 6-pile oil and gas platform (~30 x 30 m), and is comparable in size to a large jackup drilling rig.

Decommissioning financial assurance requirements were relaxed to reduce development costs, thus increasing taxpayer liability risks. This policy decision should be reviewed.

Vineyard Wind substation

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BOEM Rescinds Designated Wind Energy Areas on the Outer Continental Shelf

Posted in energy policy, Offshore Wind, tagged , , on July 30, 2025| Leave a Comment »

“By rescinding WEAs, BOEM is ending the federal practice of designating large areas of the OCS for speculative wind development, and is de-designating over 3.5 million acres of unleased federal waters previously targeted for offshore wind development across the Gulf of America, Gulf of Maine, the New York Bight, California, Oregon, and the Central Atlantic.”

full announcement

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Nantucket gives Vineyard Wind 2 weeks to respond to demands

Posted in Offshore Wind, energy policy, tagged , , , , , on July 30, 2025| Leave a Comment »

On Tuesday morning, the Nantucket Select Board blasted Vineyard Wind and gave the company 2 weeks to respond to their 15 demands. The Nantucket Current provides good coverage of the press conference. The specific demands are listed below.

  1. Text emergency notifications to designated Town officials within 1 hour.
  2. Alert the same officials when blade monitors detect anomalies.
  3. Share with Nantucket the content of any written communications with or from federal agencies regarding project failures that have impacts on Nantucket.
  4. Email detailed monthly project updates to the Select Board and Town Manager.
  5. Present updates and take public questions at Select Board meetings upon request and no less than quarterly.
  6. Respond to written questions from the Select Board within three business days.
  7. Provide relevant project reports within 1 week of submission to any agency.
  8. Share all studies or data reports on adverse effects within five business days of receipt.
  9. Disclose correspondence with regulatory agencies within 15 business days.
  10. Notify the Town if the company is asserting any confidentiality claims to shield public disclosure of reports or data in regulatory filings.
  11. Pay liquidated damages ($250,000) per violation of the above communication protocols.
  12. Pay liquidated damages ($25,000) per turbine per day) for each day that turbine lights are on without the Aircraft Detection and Lighting System (ADLS) being active.
  13. Within 2 months, initiate a process to seek public input on new emergency response plans—including blade failure scenarios.
  14. Establish and maintain a $10 million escrow fund to ensure coverage of cleanup costs from future failures.
  15. Permanently suspend new projects if any future incident forces beach closures or shellfish harvesting bans for seven consecutive days or 14 total days in any 6-month period.

I observed the press conference on the Town’s YouTube channel, and my sense is that this may be Vineyard Wind’s last chance to amicably resolve these issues. Board member Dawn Hill, who now regrets signing the increasingly unpopular Good Neighbor Agreement with Vineyard Wind, didn’t hold back when she said:

“These wind turbines are bigger, brighter, and much more impactful than we ever thought, and not to mention the environmental hazard from failures. But my choice would be with our new, federal administration to really wake up and try and put an end to these things, because they’re not worth it to the coast of the United States.”

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Emergency Petition to Revoke Empire Wind Letter of Authorization

Posted in energy policy, Offshore Wind, Regulation, tagged , , , on July 28, 2025| Leave a Comment »

The attached petition from Save the East Coast Inc. et al requests that NOAA revoke the Empire Wind Letter of Authorization using the emergency authority delineated at 50 C.F.R. § 216.106(f).

This is a strong filing, but revocation would be difficult given the extensive development activity to date and the Administration’s decision in May to allow the project to go forward.

Petition to NOAA to revoke Empire Wind LOA _july_24_FINAL_SUBMITEDDownload

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