U.S. Offshore Wind Faces Strong Gusts From Trump Executive Order; Shell Abandons Atlantic Shores Project

Following President Trump's executive order targeting the development of offshore wind power, one major company has already scrapped its U.S. offshore wind plans. The executive order is a significant setback for the industry, which has already been suffering from high project development costs associated with construction and financing. This executive order dampens developer/investor confidence and creates uncertainty regarding the growth of offshore wind power in the U.S. in the near to medium term.

Key Highlights
-- President Trump's executive order targeting the development of offshore wind power is a significant setback for the industry.
-- Restrictions on offshore wind development include a withdrawal of all areas on the Outer Continental Shelf from offshore wind leasing and a review of current leasing and permitting practices for wind projects.
-- Multiple federal agencies will be involved in assessing the economic costs associated with the intermittent generation of electricity and the effect of subsidies on the viability of the wind industry.
-- The executive order dampens developer/investor confidence and creates uncertainty regarding the growth of the U.S. offshore wind power industry, which has already been suffering from high project development costs associated with construction and financing.

"We think projects already under construction would likely not be directly affected by this executive order, because the order did not require work to stop on any of these projects. But there is some uncertainty regarding whether this order could affect U.S. projects that may be in early stages of development or in the permitting process, especially with Shell backing out," said Kevin L. Beicke, Vice President, Asset Finance.