A joint venture between BP and Japan’s JERA has decided to pull the plug on a major offshore wind project in the United States, citing soaring costs and a change in federal policies.
JERA Nex BP said inflation had also motivated its decision, which would see its U.S. workforce laid off over the next few months, the company said in a statement.
“JERA Nex bp has taken the difficult decision to reduce our activities in the US to a minimal level and will close our operating activities in the market. Unfortunately, as a result of this, all team members will leave the company in the coming months,” the statement said.
“The US is a market with significant long-term potential for offshore wind, which we still believe can play a key role in the country’s energy transition. Unfortunately, in the present environment, we see no viable path to the development of our Beacon wind project and have concluded that we cannot continue our investment in the market,” the company also said.
The Trump administration has been on the war path against energy transition companies, but offshore wind has received a special focus, with the President repeatedly declaring his dislike for the technology, which critics have pointed to as one of the most expensive non-hydrocarbon energy sources and an environmental problem because of bird and whale deaths—the latter disputed by pro-wind activists and the bird deaths considered within acceptable limits.
The Beacon offshore wind installation, between Cape Cod and Long Island, was supposed to have a total capacity of 2.5 GW covering 128,000 acres. BP said in a fact sheet for the project that it would generate energy to supply as many as 1 million households in the northeastern U.S. Despite the cancellation of the project, BP and JERA said they would keep the lease for the location for the time being.
By Irina Slav for Oilprice.com
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