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Ocean Wind 1


Ocean Wind 1 was a proposed offshore wind farm project located approximately 15 miles (24 kilometers) southeast of Atlantic City, New Jersey, with a planned capacity of 1,100 megawatts.
Developed primarily by Ørsted following its acquisition of full ownership from initial partner Public Service Enterprise Group, the project envisioned up to 98 wind turbine generators, including Haliade-X 12 MW models, connected via inter-array cables to offshore substations and onshore infrastructure at two landfall sites.
Positioned within Bureau of Ocean Energy Management Lease Area OCS-A 0498, it received a federal Record of Decision approving its Construction and Operations Plan in July 2023, positioning it as a potential early contributor to New Jersey's offshore wind targets.
However, Ørsted ceased development in October 2023, attributing the decision to escalating costs from inflation, higher interest rates, and supply chain constraints that eroded project economics, rendering it unviable without further support.
This termination, alongside that of the co-located Ocean Wind 2, underscored broader difficulties in the U.S. offshore wind industry, where multiple initiatives have encountered financial hurdles despite subsidies and leases, raising questions about the scalability and cost-competitiveness of such ventures against empirical economic pressures.

Project Overview

Location and Specifications


Ocean Wind 1 is an offshore wind energy project situated within (BOEM) Lease Area OCS-A 0498, approximately 13 nautical miles (15 statute miles) southeast of Atlantic City in southern , . The lease area encompasses waters in the Atlantic Ocean off the coast of Atlantic and Cape May counties, with the nearest point to shore about 21 kilometers from landfall points near Atlantic City. The project was designed to generate 1,100 megawatts (MW) of capacity, sufficient to power over 500,000 homes in . It planned for up to 98 generators (WTGs), each rated at 12 MW using Haliade-X models, along with up to three offshore alternating current substations and associated array cables linking turbines to export cables. Foundations were to employ monopile structures suited for the conditions in depths ranging from 20 to 50 meters. Interconnections were targeted to onshore substations in via export cables.

Developers and Ownership

Ocean Wind 1 was developed by Ørsted, a Danish multinational energy company focused on projects, through its Ørsted . The project originated as a under Ocean Wind LLC, where initial ownership was divided with Ørsted holding a 75% stake and (PSEG), a New Jersey-based utility, holding the remaining 25%. This structure supported the project's bid and early development following the allocation of a lease area by the U.S. in 2019. In January 2023, Ørsted announced its intent to purchase PSEG's equity share to consolidate full control, citing strategic alignment with ongoing planning and permitting efforts. The transaction, valued at an undisclosed amount, was completed on June 2, 2023, granting Ørsted 100% ownership of the 1,100 MW project. PSEG's exit allowed it to redirect resources toward other renewable initiatives, while Ørsted assumed sole responsibility for development, including procurement and interconnection. Ørsted retained full through the project's cessation in October 2023, when its board decided to halt amid rising costs and supply chain issues. No subsequent ownership transfers have been reported, with Ørsted listed as the operator and in project records.

Development History

Lease Acquisition and Early Planning

The (BOEM) conducted a competitive for commercial wind energy leases in the Wind Energy Area on November 9, 2015, offering approximately 344,000 acres divided into two areas. RES America Developments Inc. won Lease OCS-A 0498, the southern portion encompassing 160,480 acres located 15-20 miles offshore southern , with a bid of $880,715 after seven rounds. The lease was formally executed on March 1, 2016. In February 2016, RES America Developments Inc. entered an agreement to transfer the OCS-A 0498 lease to DONG Energy (later rebranded as Ørsted), with the transaction completing on May 19, 2016, after BOEM approval. Ørsted established Ocean Wind LLC as the project development entity and lessee, initiating early planning under the Ocean Wind project name, which targeted up to 1,100 MW capacity within the lease area. Early development efforts post-acquisition focused on site characterization and feasibility assessments, including geophysical and geophysical surveys to evaluate resources, conditions, and potential environmental impacts as required under BOEM's Site Assessment Plan process. Ørsted conducted initial engagements with fishing industries, coastal communities, and state agencies to address concerns over , fisheries, and visual impacts, while advancing preliminary for layouts and transmission corridors. These activities laid the groundwork for subsequent regulatory submissions, though development faced delays due to evaluations and market conditions.

Permitting and Regulatory Approvals

The (BOEM) led the federal permitting process for Ocean Wind 1 as the primary agency responsible for approving offshore renewable energy projects under the Lands Act. Ocean Wind LLC submitted its Construction and Operations Plan (COP) to BOEM on August 15, 2019, with subsequent revisions including updates on March 13, 2020, and September 2020, among others up to April 24, 2023. BOEM published a (EIS) in June 2022 to assess potential environmental effects, followed by the Final EIS on May 26, 2023, which evaluated impacts on physical, biological, and socioeconomic resources and identified mitigation measures. BOEM issued a joint Record of Decision (ROD) with the (NMFS) on July 5, 2023, approving the COP subject to conditions and granting NMFS authorization under the Marine Mammal Protection Act for incidental take of marine mammals during construction and operations. On September 21, 2023, BOEM granted final approval of the COP and associated project easement for lease area OCS-A 0498, authorizing construction of up to 98 generators, three offshore substations, and related infrastructure approximately 13 nautical miles southeast of . This approval incorporated requirements for monitoring, vessel strike avoidance, and fisheries coordination to minimize environmental risks. Additional federal approvals included applications to the U.S. of Engineers (USACE) for Section 404 and Rivers and Harbors Act Section 10 permits, submitted May 11, 2022, and Section 408 authorization for alterations to federal civil works, completed May 27, 2022; determinations of no hazard from the for turbine structures in February 2022; and anticipated U.S. authorizations for private aids to navigation. The U.S. Environmental Protection Agency received a Clean Air Act Outer Continental Shelf air permit application on January 4, 2023, and the Bureau of Safety and Environmental Enforcement reviewed an response plan integrated with the . At the state level, the Department of (NJDEP) issued key permits on April 27, 2023, including a Waterfront Development Permit, Coastal Area Facility Review Act Permit, Coastal Wetlands Permit, Flood Hazard Area Verification, Freshwater Wetlands Permit, and Section 401 Certification, certifying compliance with state coastal zone management and water quality standards for onshore cable landings and substation construction. NJDEP also approved consultations and a major diversion of parkland on March 9, 2023, while local approvals such as plans, highway occupancy permits, and zoning from Ocean and May Counties were anticipated in the third quarter of 2023. These layered approvals addressed cumulative impacts but required ongoing compliance monitoring prior to full construction commencement.

Pre-Construction Activities

Ocean Wind LLC conducted site characterization surveys within its lease area OCS-A 0498, encompassing high-resolution geophysical (HRG) operations using sub-bottom profilers, multibeam echosounders, , and magnetometers to map seafloor , detect buried features, and identify potential archaeological resources. These surveys generated underwater levels that prompted NOAA Fisheries to issue an Incidental Authorization (IHA) on May 13, 2022, permitting Level B behavioral harassment of mammals such as dolphins and , with mandatory deployment of protected species observers (PSOs) on survey vessels to monitor and mitigate encounters. Geotechnical investigations followed, involving seabed borings, cone penetration tests, and vibrocores to evaluate soil strength, stratigraphy, and suitability for monopile foundations, coordinated with geophysical efforts to minimize vessel traffic and seabed disturbance. These activities, permitted under New Jersey Department of Environmental Protection waterfront development approvals, provided data critical for finalizing foundation designs and export cable routes in the Construction and Operations Plan (COP) submitted to BOEM. Environmental components included sediment grab sampling and sediment profile imaging to assess benthic habitats and essential fish habitat, supporting compliance with Magnuson-Stevens Act consultations. Archaeological surveys integrated data from HRG operations with diver or ROV inspections where anomalies were detected, fulfilling BOEM requirements for cultural resource assessment prior to disturbance. Surveys occurred intermittently from 2019 onward, intensifying in 2022 to align with review timelines, though full-scale construction mobilization never proceeded due to subsequent termination.

Project Cancellation

Announcement and Timeline

Ørsted, the developer of Ocean Wind 1, announced on October 31, 2023, that its had decided to cease development of the project along with Ocean Wind 2, citing escalated costs, disruptions, and inability to secure a viable path to final investment decision (FID). This marked the formal termination of efforts to construct the 1,100 MW offshore wind farm off the coast, which had been awarded a and power purchase agreements in prior years. The timeline leading to the announcement involved mounting financial pressures throughout 2023, including supplier delays and rising interest rates that rendered the projects unviable without further support. Ørsted's disclosure coincided with its nine-month financial results release on November 1, 2023, which reported a $2.2 billion impairment charge related to U.S. offshore wind activities, underscoring the scale of losses from halting Ocean Wind 1. In parallel, Ørsted proceeded to FID for its Revolution Wind project on the same date, indicating selective continuation of viable U.S. initiatives. Post-announcement, Ørsted began winding down activities, including termination of related contracts and return of leased areas to federal authorities, with no resumption planned as of the latest updates. The decision prompted immediate reactions from officials, who expressed disappointment but acknowledged broader industry challenges.

Stated Reasons and Contributing Factors

Ørsted announced the cessation of Ocean Wind 1 and Ocean Wind 2 development on , , attributing the decision primarily to macroeconomic pressures that had intensified since the projects' initial contracting in 2019. The company cited high inflation, escalating interest rates, and persistent disruptions as key drivers rendering the projects economically unviable, with these factors leading to substantial cost overruns and delays beyond initial projections. Specifically, additional delays from suppliers exacerbated timeline slippages, increasing financing costs and straining the fixed-price power purchase agreements secured earlier. Contributing factors included broader U.S. offshore wind market challenges, such as bottlenecks in turbine manufacturing and vessel availability, which Ørsted noted had not been fully anticipated at the bidding stage. Rising global interest rates, peaking above 5% for U.S. federal funds in 2023, amplified the for capital-intensive projects like Ocean Wind 1, whose estimated development expenses had ballooned due to inflationary pressures on materials and labor. In a subsequent settlement with on May 29, 2024, Ørsted reiterated these elements—supply chain issues, , and interest rate hikes—as the causal chain prompting termination, avoiding a full $300 million forfeiture through a $125 million . While Ørsted emphasized external macroeconomic shifts, analysts have pointed to underlying bid aggressiveness in 2021 auctions, where contracts were awarded under more favorable economic conditions, as a contributing vulnerability when post-pandemic surged to 9.1% in mid-2022. The decision aligned with similar cancellations across the sector, underscoring how fixed-offtake terms failed to accommodate rapid cost escalations in an immature U.S. reliant on imported components.

Technical Design

Turbine and Foundation Details

The Ocean Wind 1 project was designed to incorporate up to 98 Haliade-X offshore , each with a rated of 12 MW and an option to to 13 MW. These turbines feature a rotor of up to 240 meters (788 feet) and a hub height of 156 meters (512 feet), enabling operation in water depths ranging from 15 to 43 meters. The Haliade-X model is noted for its high efficiency, with a of 60-64%, achieved through advanced and direct-drive technology that eliminates gearboxes. Each turbine was planned to be mounted on a monopile foundation, consisting of a single steel cylindrical structure driven into the to support the tower, , and assembly. Monopiles for the project measured approximately 87 meters in length, with a top diameter of 8 meters tapering to a larger base diameter for stability in sandy conditions. Scour protection measures, such as rock armor or mattresses, were intended to mitigate around the foundations. Manufacturing of the monopiles commenced in 2023 at facilities in , with initial units rolled out for potential installation starting in 2024, though the project was subsequently canceled.

Electrical Infrastructure and Grid Integration

The Ocean Wind 1 planned an electrical infrastructure comprising inter-array cables connecting up to 98 generators to up to three substations, where voltage would be stepped up for export. Inter-array cables were specified at 170 kV, with burial depths targeting 4 to 6 feet depending on conditions. Interconnector cables were intended to link the offshore substations. Offshore export cables, operating at 275 kV, would transmit power from the substations to onshore grid connections, consisting of three cables with landfalls in Cape May County and Ocean County, New Jersey. Up to eight export cable circuits, each potentially comprising three single cables made of copper or aluminum conductors, were proposed for burial below the seabed in federal and state waters. Onshore, underground export cables would route from landfall points to substations at the B.L. England site in Upper Township, Cape May County, and the Oyster Creek site in Ocean County. The project included two interconnection points with the regional transmission system at these locations. JINGOLI Power was contracted in April 2022 to install the onshore underground cables to the B.L. England substation.

Economic Analysis

Development and Projected Costs

Ørsted, in partnership with (PSEG), was awarded the rights to develop Ocean Wind 1 through New Jersey's first offshore wind solicitation on June 21, 2019, securing an Offshore Renewable Energy Certificate (OREC) agreement for up to 1,100 MW of capacity. The project advanced through federal and state permitting, culminating in a Record of Decision from the (BOEM) on July 5, 2023, which approved the Construction and Operations Plan and enabled onshore construction to commence in fall 2023, with offshore installation targeted for 2024 and commercial operations by 2025. In January 2023, Ørsted acquired PSEG's 25% equity stake, assuming full ownership and responsibility for development. Pre-construction milestones included the rollout of the first monopile foundation at EEW's facility in July 2023, signaling entry into fabrication for the 98 planned Haliade-X 12 MW turbines. As part of development commitments, Ocean Wind 1 pledged $695 million in in-state spending during construction, aimed at supporting local and job creation, alongside up to $15 million for the Pro-NJ Trust to aid businesses entering the offshore wind sector. These investments were tied to the project's OREC terms, which set a of $84.03 per MWh for the 2029 vintage, reflecting expectations of viability under New Jersey's renewable portfolio standards. Total projected capital costs were not publicly detailed by Ørsted prior to cancellation, though industry benchmarks for U.S. offshore wind projects around that period averaged approximately $3,550 per kW, implying a rough scale of $3.9 billion for 1,100 MW capacity based on contemporaneous Department of data. Rising constraints, , and interest rates ultimately rendered these projections uneconomic, contributing to Ørsted's decision to impair approximately $2.8 billion associated with the project upon cessation in 2023.

Financing Structure and Offtake Agreements

The Ocean Wind 1 project was structured with Ørsted holding 100% ownership following its acquisition of Enterprise Group's (PSEG) 25% , which was completed in June 2023 after an agreement signed in January 2023. Prior to this, the comprised Ørsted at 75% and PSEG at 25%, reflecting a typical developer-led model for U.S. offshore wind projects where sponsors fund until financial close. No debt financing or tax partnerships were finalized, as the project did not achieve final investment decision (FID) prior to its cancellation in October 2023; planned financing would have relied on non-recourse project debt and federal investment tax credits (ITCs) enhanced under the 2022 , which allow transferability to monetize credits without requiring direct tax appetite from investors. Offtake was secured through a (PPA) with the Board of Public Utilities (NJBPU), structured as an Offshore Renewable Energy Certificate (OREC) mechanism guaranteeing revenue for up to 20 years based on projected output of 4,851 GWh annually from the 1,100 MW capacity. The initial was set at $98.10 per MWh in year one, escalating over the term to account for inflation and fixed-price certainty, enabling the project to bid competitively in New Jersey's 2019 solicitation while shifting market and construction risks to developers. This OREC-backed offtake was integral to projected cash flows for debt service and equity returns, though rising costs ultimately rendered the economics unviable without renegotiation, which Ørsted cited as a factor in termination.

Economic Viability and Broader Market Challenges

Ørsted terminated development of Ocean Wind 1 on October 31, 2023, determining the project financially unviable amid escalating costs from disruptions, inflation-driven increases in materials and installation expenses, and elevated interest rates that hindered refinancing. The decision followed a reassessment revealing that these macroeconomic pressures had eroded the project's margins, with Ørsted projecting a provision for losses impacting its Q4 2023 EBITDA by approximately 2.2 billion Danish kroner (about $320 million USD at the time). These factors extended beyond Ocean Wind 1 to broader U.S. offshore wind market dynamics, where surged post-2022, prices rose, and bottlenecks—exacerbated by global events including the aftermath and geopolitical tensions—doubled or tripled component costs for turbines, foundations, and vessels compared to 2021 bids. Developers with fixed-price offtake agreements, like those under New Jersey's solicitations, faced negative returns as levelized costs exceeded (PPA) prices, prompting cancellations or rebids for higher rates in states from to . Financing challenges compounded viability issues, with higher interest rates since 2022 increasing the for capital-intensive projects, while immature domestic supply chains limited and exposed developers to international . Critics, including economic analyses, argue that offshore wind's inherent high upfront costs—often requiring federal tax credits like those expanded under the 2022 —impose upward pressure on electricity rates without guaranteed reliability benefits, as evidenced by European precedents where similar projects have led to subsidy hikes amid underperformance. Despite policy supports, 2024 market reports indicate persistent , with over 20 gigawatts of announced U.S. at of delay or abandonment unless states adjust to reflect true costs.

Environmental Claims and Realities

Asserted Climate Benefits

Proponents of Ocean Wind 1, including developer Ørsted and the U.S. (BOEM), asserted that the project would deliver substantial climate benefits by generating carbon-free electricity to displace fossil fuel-based power in the grid, which relies heavily on and residual . The 1,100 MW facility was projected to produce sufficient for approximately 500,000 average homes annually, contributing to the state's targets for 100% clean energy by 2035 and net-zero emissions economy-wide by 2050. BOEM's Final (EIS) concluded a net reduction in (GHG) emissions from the project's operations and maintenance phase, as direct wind generation emits no CO2 during production, while offsetting emissions from equivalent alternatives. The EIS quantified avoided criteria emissions, such as 2,362 tons of and 5,705 tons of another annually due to displacement effects, with analogous benefits asserted for GHGs given the minimal operational emissions estimated at low levels (e.g., from vessel traffic and maintenance). Lifecycle GHG assessments for similar offshore wind developments report emissions intensities of 13 g CO2eq per kWh, a 98% reduction relative to combined-cycle plants (approximately 400-500 g CO2eq/kWh). These asserted benefits positioned Ocean Wind 1 as supportive of broader regional GHG reduction goals under initiatives like the , with the project's intermittent output claimed to lower overall grid emissions intensity when integrated with existing infrastructure. However, such projections assume effective displacement of higher-emitting sources, a claim not independently verified in the EIS beyond modeling based on planned capacity factors around 45%.

Marine Ecosystem Risks and Empirical Evidence

Construction of Ocean Wind 1's monopile foundations requires impact pile driving for up to 98 turbines, producing intense underwater noise pulses that propagate widely and can induce temporary threshold shift (TTS) or permanent threshold shift (PTS) in hearing-sensitive marine mammals like seals, dolphins, and whales, alongside behavioral disruptions such as displacement and masking of echolocation. Empirical measurements from European offshore wind farms, including acoustic monitoring during pile driving, confirm noise levels exceeding 200 dB re 1 μPa at source, correlating with observed avoidance radii of several kilometers for harbor porpoises and potential auditory injury within 10-20 km depending on pile size and hammer energy. A review of 158 studies found 7% of empirical findings on marine mammals indicated negative impacts, predominantly from construction-phase noise, with high-confidence evidence of porpoise displacement persisting weeks post-activity in North Sea sites. Associated construction activities, including and cable burial, elevate and sediment suspension, temporarily degrading and smothering benthic and fish eggs in the lease area off , where soft sediments predominate. Evidence from monitoring showed localized benthic mortality and community shifts following foundation installation, with recovery timelines of 1-3 years but initial losses in infaunal diversity up to 50% within 500 m of structures. Pile driving and trenching also risk direct mortality to fish via or , though population-level effects remain unquantified; modeling from similar U.S. East Coast projects predicts negligible long-term fishery impacts but acknowledges data gaps in larval stages. During operations, subsea cables for Ocean Wind 1 will emit low-frequency electromagnetic fields (EMFs) from alternating current transmission, potentially disorienting electro- and magnetosensitive species like elasmobranchs (sharks, rays) and diadromous fish during migration or foraging. Laboratory and field tests indicate elasmobranchs alter swimming paths and prey detection at EMF strengths of 1-10 μT, comparable to cable outputs within 1-5 m, though in-situ evidence from operational farms shows limited behavioral changes beyond immediate cable proximity, with no confirmed population effects. Habitat conversion from soft to hard substrates around foundations may initially reduce suitability for sediment-dependent species, evidenced by North Sea studies reporting 20-30% declines in certain mollusks and echinoderms pre-reef colonization, despite later biodiversity gains from artificial reef effects. A global synthesis of offshore wind impacts reveals over 86% of potential effects, including cascading trophic disruptions, remain empirically unassessed, with negative findings (72% of reports) outweighing positives, underscoring uncertainties for Ocean Wind 1's South Atlantic Bight location where baseline data on species like right whales is limited. While mitigations like bubble curtains for and burial depths for cables are proposed, their efficacy varies; trials reduced pile by 7-10 but did not eliminate far-field disturbances. No irreversible population declines are projected for Ocean Wind 1, yet localized, irretrievable losses to individuals and habitats are anticipated based on analogous projects.

Wildlife and Biodiversity Concerns

The proposed Ocean Wind 1 project, located approximately 15 miles off the coast, raises concerns regarding acoustic disturbances to marine mammals from pile driving and vessel operations, which could induce temporary threshold shifts or permanent hearing damage in species like the endangered (Eubalaena glacialis). The () environmental impact statement () models sound pressure levels from operational turbines at 109-177 dB re 1 μPa, with behavioral responses varying by species and life stage, though long-term population-level effects remain uncertain due to incomplete data on cumulative stressors from multiple Atlantic projects. Increased vessel traffic during construction and maintenance heightens collision risks for large whales, a primary known mortality factor, with mitigation measures such as seasonal restrictions and speed limits proposed but unproven at scale for this region. Bird , including migratory seabirds, face potential collision mortality with blades, with the EIS citing from areas and barriers to flight paths as additional risks, informed by European operational data showing up to 10% negative impacts on populations. Modeling for Ocean Wind 1 estimates low collision probabilities based on onshore extrapolations, but activity—potentially including eastern red bats during diurnal migrations—introduces uncertainty, as no U.S. fatalities have been documented yet, though land-based rates suggest elevated risks for certain taxa. Post-construction protocols are mandated, including surveys, but critics note reliance on developer-led data may underreport incidents. Fish and benthic communities could experience from monopile foundations and electromagnetic fields (EMFs) from subsea cables, potentially disrupting , predation, and electrosensory navigation in like elasmobranchs, with effects confined to within a few meters of cables per available studies. While foundations may create artificial reefs enhancing local aggregation, broader concerns include non-native introduction via and reduced services, with over 86% of offshore wind impacts on such services remaining empirically unassessed globally. The EIS acknowledges irreversible harm potential to Act-listed populations if individuals suffer injury, emphasizing the need for amid data gaps in decommissioning effects and synergistic stressors like climate-driven shifts.

Social and Industry Impacts

Fisheries and Commercial Interests

operations in the coastal region, including the Ocean Wind 1 lease area approximately 15-20 miles offshore, support a vital targeting such as Atlantic surf clams, ocean quahogs, and , with annual landings valued at over $100 million statewide. Fishermen have expressed significant concerns that turbine installation, cabling, and operational restrictions could displace vessels from traditional grounds, increase collision risks with unlit structures during maintenance, and damage gear through interactions with foundations or exclusion zones spanning up to 1,000 square miles across multiple projects. These issues contributed to legal challenges, including a 2023 lawsuit by Cape May County alleging inadequate federal assessment of cumulative fishery disruptions from Ocean Wind 1 and adjacent developments. In response, Ocean Wind LLC outlined mitigation measures including a Gear Claim Procedure for reimbursing damaged equipment, a Direct Compensation Program for lost fishing time or revenue, and a Navigational Safety Fund offering grants for vessel radar and safety upgrades. The project also committed to a Compensatory Mitigation Fund via memorandum with New Jersey authorities to address impacts on prime fishing areas, alongside pre-construction surveys confirming no major adverse effects on marine life from similar activities. However, industry representatives, including those from the Responsible Offshore Development Alliance, have criticized these as insufficient without long-term empirical data on post-construction fishery yields, noting that European precedents show variable displacement effects unresolved by compensation alone. Ocean Wind 1 allocated nearly $13 million for fisheries monitoring, including seven surveys using (eDNA) to detect species presence before and after —the first such application in a U.S. wind energy area—along with trawl assessments finding localized, short-term disturbances but no broad habitat sensitivity. An Essential Fish Habitat assessment concluded that project effects on managed species under the Magnuson-Stevens Act would be minimal due to temporary impacts and avoidance of sensitive benthic areas. Despite these efforts, commercial interests remain wary, as broader Atlantic wind development has prompted calls for independent, peer-reviewed studies on revenue losses, with some fishermen reporting preemptive avoidance of lease zones amid perceived regulatory favoritism toward renewables. The project's cancellation by Ørsted in October 2023, citing economic factors, did not fully alleviate tensions, as obligations for and partial mitigations persisted, highlighting ongoing uncertainties in balancing wind development with commercial access rights. incidental take authorizations for mammals during underscored potential indirect effects via prey disruption, though authorized takes were deemed non-lethal and monitored.

Community and Visual Objections

Coastal communities in , particularly in Cape May County, voiced strong opposition to Ocean Wind 1, citing risks to the tourism-dependent local economy from potential visual alterations to ocean views. The Cape May County Board of Commissioners unanimously passed Resolution 314-23 on May 23, 2023, directing resources to halt the project due to anticipated harms to , , and the marine environment. Local officials referenced studies projecting up to a 15 percent decline in revenue from turbine visibility. Residents and businesses in areas like Atlantic City and Ocean City argued that the introduction of industrial-scale structures would degrade the aesthetic appeal of beaches, deterring visitors reliant on unobstructed seascapes. Visual objections focused on the project's 98 planned turbines, each up to 906 feet tall, positioned 15 to 20 miles , which could be visible from shore under clear atmospheric conditions extending up to 43 miles. The Bureau of Ocean Energy Management's Final identified 32 key observation points, including Atlantic City Beachfront at 15.3 miles and at 40 miles, where the upper portions of turbines—potentially appearing as a linear array on the horizon—would cause moderate adverse impacts on scenic quality and recreation. Public scoping comments emphasized concerns over "viewshed degradation" and the intrusion of man-made elements into pristine coastal vistas, potentially affecting property values and visitor experiences at historic sites like Absecon . While the EIS referenced wind projects showing no significant downturns, local stakeholders contested this applicability, highlighting the Jersey Shore's unique reliance on natural beauty for seasonal revenue exceeding $10 billion annually. Opposition extended to onshore elements, with communities attempting to block cable landings and grid connections; for instance, residents flooded a Dennis Township meeting on February 27, 2023, to infrastructure approvals needed for Ocean Wind 1. A 2021 state law amendment stripped most local veto power over landings, prompting backlash from towns that viewed it as overriding community input on visual and economic risks. Mitigation proposals in the EIS, such as removing up to 19 near-shore turbines, non-reflective paint on blades, and aircraft detection systems to limit visible strobes to under 1 percent of operation time, were deemed insufficient by critics to preserve the unindustrialized horizon. These objections contributed to broader resistance, including lawsuits alleging inadequate environmental reviews of cumulative visual effects from multiple regional projects.

Job Projections versus Actual Outcomes

Developer projections for the Ocean Wind 1 project estimated the creation of over 15,000 jobs across its 25-year operational lifespan, including direct construction roles, operations and maintenance positions, and indirect supply chain employment in New Jersey and surrounding regions. These figures, promoted by Ørsted and state economic development authorities, encompassed approximately 6,598 job-years during the construction phase alone, equivalent to full-time labor inputs spread over that period. In practice, pre-construction activities generated limited , such as work and initial contracts awarded in April 2022 for onshore infrastructure, which were projected to support up to 275 jobs in through underground cabling and substation installation. However, Ørsted's decision to terminate development on October 31, 2023—attributed to rising rates, , and constraints—halted progress before offshore or full-scale onshore construction commenced, preventing realization of the broader workforce benefits. The cancellation yielded no operational or long-term jobs, with any early-stage positions curtailed and no quantified net gains reported for the tied directly to the . Economic analyses of similar offshore wind initiatives have highlighted that such projections frequently aggregate temporary labor—often lasting 2-3 years per —with permanent roles, while multipliers for indirect effects can inflate totals without verifying sustained impacts or offsetting costs to taxpayers and consumers. As of 2025, New Jersey's offshore wind sector has faced repeated terminations, underscoring challenges in translating ambitious job forecasts into durable outcomes amid volatile market conditions.

Legal and Regulatory Controversies

Key Lawsuits and Challenges

In October 2023, Cape May County, along with the groups Save Cape May and Protect Our Coast , filed a federal lawsuit (County of Cape May v. , No. 1:23-cv-21201, D.N.J.) challenging the Bureau of Ocean Energy Management's (BOEM) September 21, 2023, approval of the Construction and Operations Plan for Ocean Wind 1. The plaintiffs alleged violations of the (NEPA), Act, and other statutes, claiming BOEM's failed to adequately assess risks to North Atlantic right whales, commercial fisheries generating over $100 million annually in the region, and the $7.4 billion tourism industry through visual and economic disruptions. The suit sought to vacate the approvals, but it was dismissed without prejudice on November 20, 2024, following Ørsted's termination of the project on October 27, 2023, due to escalating costs and interest rates exceeding project viability. At the state level, in June 2023, Protect Our Coast NJ, Defend Brigantine Beach, and Citizens for Clean Air and Clean Water appealed the New Jersey Department of Environmental Protection's (NJDEP) April 2023 consistency certification under the Coastal Zone Management Act, which deemed Ocean Wind 1 compatible with 's coastal policies. The appellants argued the certification ignored evidence of adverse effects on fisheries, , water quality, and scenic views from key observation points along 65 miles of coastline, violating enforceable policies against incompatible energy facilities. The , Appellate Division, received the notice of appeal, but proceedings stalled after Ørsted's project cancellation rendered the certification moot, with no final ruling issued. Separately, in July 2023, Defend Brigantine Beach and Protect Our Coast NJ sued in New Jersey state court to block a $1.1 billion subsidy package approved by the state legislature for Ocean Wind 1, contending it constituted an unconstitutional expenditure of public funds without sufficient public benefit or competitive bidding. The challenge highlighted fiscal risks amid rising turbine costs, but like other actions, it did not advance to a merits decision post-termination. These suits reflected broader concerns from fishing and tourism stakeholders over unmitigated ecological and economic harms, though federal and state agencies maintained the project's reviews complied with law prior to its abandonment.

Policy and Subsidy Dependencies

The Ocean Wind 1 project, with a planned capacity of approximately 1,100 megawatts, secured a 20-year contract for Offshore Renewable Energy Certificates (ORECs) through New Jersey's third competitive offshore wind solicitation in December 2021, entitling developers to above-market payments from ratepayers to offset high generation costs exceeding wholesale prices. These ORECs, priced initially at $98.10 per megawatt-hour in the first year with annual adjustments, represented a core financial mechanism, as unsubsidized offshore wind levelized costs in the U.S. typically range from $100 to $200 per megawatt-hour, far above onshore alternatives or . Federally, the project anticipated substantial support from the Inflation Reduction Act of 2022, which extended the Investment Tax Credit (ITC) at a base rate of 30% of qualified costs for offshore wind facilities beginning construction by December 31, 2026, with potential adders up to 10% for domestic content and prevailing wage compliance, potentially totaling 40-50% in credits. For Ocean Wind 1, these credits were estimated to approach $1 billion, prompting New Jersey lawmakers to enact S4019/A5651 in July 2023, allowing Ørsted to retain incremental federal benefits without corresponding reductions in OREC payments, thereby preserving the full subsidy value amid concerns over rising construction expenses. Policy dependencies included New Jersey's , mandating 2,500 megawatts of offshore wind by 2035 as part of broader decarbonization goals, alongside approvals from the (BOEM) for leasing and environmental reviews under the Lands Act. Despite these supports, Ørsted terminated development on October 31, 2023, citing disruptions and hikes that inflated costs by over 20% since bidding, rendering the project uneconomic even with combined and incentives; this led to $300 million in owed to and a subsequent $125 million settlement in May 2024. Such outcomes underscore the sector's vulnerability to policy shifts, as alterations in subsidy structures or permitting timelines—exemplified by potential lease auction pauses—could further deter viability without ongoing government intervention.

Policy Lessons and Future Implications

Alignment with US Energy Goals

Ocean Wind 1, planned at 1,100 MW capacity, was intended to advance the Biden administration's goal of 30 GW of wind deployment by 2030, sufficient to power approximately 10 million homes annually with renewable . The project received a federal Record of Decision from the on July 5, 2023, supporting New Jersey's target of 11 GW offshore capacity by 2040 and contributing to state renewable mandates for 50% clean by 2030. However, its alignment with broader U.S. objectives—such as grid reliability, affordability, and security—remains limited due to inherent . Offshore wind projects like nearby South Fork Wind have operated at capacity factors of about 45% from July 2024 to July 2025, generating power only when wind conditions allow, necessitating backups or to maintain baseload stability. This variability contrasts with U.S. priorities for dispatchable sources that ensure uninterrupted supply, as emphasized in policy shifts toward energy dominance via domestic and oil production. Post-2024, the administration's executive actions, including cancellation of federal funding for ports and a pause on new leasing, have stalled Ocean Wind 1, now listed as dormant. These measures prioritize reducing reliance on subsidized, weather-dependent imports—such as turbine components often sourced from —over intermittent renewables, better aligning with goals of through proven, scalable domestic resources. Empirical data on high levelized costs (often exceeding $100/MWh before subsidies) further underscores misalignment with affordability targets, as requires ongoing federal incentives like production tax credits to compete.

Critiques of Offshore Wind Subsidies and Reliability

Critics argue that subsidies for offshore wind projects like Ocean Wind 1 distort markets by supporting technologies that remain uneconomic without government intervention, leading to higher costs for consumers and taxpayers. The project, initially awarded a in 2021 under New Jersey's offshore wind solicitation, was projected to receive substantial tax credits under the Production Tax Credit (PTC) and (IRA) provisions, estimated to total over $1 billion in support despite its cancellation in October 2023 due to escalating costs from , supply chain disruptions, and rising interest rates. Analyses from free-market think tanks contend that such subsidies fail to deliver cost reductions, as offshore wind's levelized cost of (LCOE) exceeds $100 per megawatt-hour in unsubsidized terms, far higher than onshore alternatives or , with bids for U.S. projects increasingly reliant on escalating and incentives rather than technological efficiencies. On reliability, wind's poses challenges for stability, as output varies with weather patterns, necessitating backup from dispatchable sources like , which increases overall system costs and emissions during low-wind periods. For Ocean Wind 1, which planned to deploy GE Haliade-X turbines with manufacturer-claimed factors of 60-64%, real-world data from operational farms indicate life-cycle factors often decline below 50% due to maintenance issues, wake effects, and , undermining projections of consistent baseload contribution. U.S. Department of the Interior officials under the administration have highlighted these limitations, stating that wind is "not reliable enough" for large-scale deployment without fossil fuel redundancy, a view echoed in critiques noting that even with interconnections, such as those planned for Ocean Wind 1 to PJM, the technology's effective credit remains low—typically 20-40% of —insufficient to displace reliable generation without overbuilding and storage investments. These subsidy dependencies and reliability gaps have prompted calls to phase out incentives, arguing they prop up projects prone to cancellation or renegotiation, as seen with Orsted's exit from Ocean Wind 1 and 2, which left ratepayers exposed to potential stranded costs while delivering minimal energy output. Empirical reviews suggest that without subsidies, offshore wind struggles competitively, with U.S. projects facing margins eroded by costs rising 20-30% since 2021, per assessments, reinforcing claims that policy-driven mandates prioritize over pragmatic .

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