Orsted Settles With New Jersey Over Cancelled Wind Farms
Orsted, a Danish wind farm developer, has agreed to pay New Jersey $125 million to resolve claims tied to the company’s cancellation of two offshore wind farms in 2025. This amount is just over one-third of the original $300 million the company had promised before abandoning the projects.
New Jersey Board of Public Utilities Announces Settlement
The state’s Board of Public Utilities announced on Tuesday that the claims between New Jersey and Orsted have been mutually settled. The decision follows Orsted’s move in October 2025 to abandon two planned wind farms off New Jersey’s southern coast.
The state plans to use the $125 million from the settlement to invest in wind energy facilities, component manufacturing facilities, and other clean energy programs.
Orsted’s Original Obligation
Prior to canceling the projects, Orsted had committed a $100 million guarantee to construct Ocean Wind I by the end of 2025. The company also had vowed to contribute an additional $200 million towards developing the offshore wind industry in New Jersey. However, after scrapping these projects, Orsted sought to evade its $300 million obligation, citing halted pursuit of the projects.
Company’s Reaction to Settlement
In a statement, Orsted expressed satisfaction with the settlement, noting that the agreement reflects the company’s total financial obligation to the state. The company also emphasized its eagerness to continue valuable partnerships with New Jersey stakeholders. However, the company made no comments regarding any future projects in the state.
Environmentalists’ Response to the Settlement
Jeff Tittel, a longtime environmentalist and retired president of the New Jersey Sierra Club, criticized the settlement, referring to it as a “sellout.” Tittel argued that the settlement allows Orsted to pay less than half of the original $300 million commitment, resulting in a loss for New Jersey.
As part of the announcement of the settlement, the administration of Democratic Gov. Phil Murphy disclosed other recent decisions regarding offshore wind. These include advancing the next solicitation for additional offshore wind projects from the third quarter of 2026 to the second quarter of 2025 and temporarily halting plans to coordinate power transmission planning for offshore wind projects with regional grid operator, PJM Interconnection.
Future of Offshore Wind Development in New Jersey
New Jersey currently has three preliminarily approved offshore wind projects. Despite opposition from groups arguing the projects are costly and potentially harmful to the marine environment, supporters contend they are a crucial step towards reducing the burning of fossil fuels and mitigating climate change. Protect Our Coast NJ, a local opposition group, criticized Gov. Murphy’s clean energy goals as “arbitrary and unrealistic” while applauding the decision to expedite offshore wind contracts.
Original Story at www.nbcphiladelphia.com