White House Says Orsted Remains 'Committed' to US Offshore Wind

Denmark's Orsted is still "committed" to developing offshore wind farms in the United States despite the company's cancellation of two projects off the coast of New Jersey, White House senior advisor John Podesta told Reuters on Monday.

Podesta spoke with the company after its shock decision last week, he said in an interview. The discussion underscores the Biden administration's keen interest in offshore wind to further the nation's climate change goals by adding zero-emissions power generation.

"Orsted is moving forward with one of its projects here. I think they remain committed to the U.S. market," Podesta said, referring to a project in New York.

The world's biggest offshore wind company last week said it would cease all development on the New Jersey Ocean Wind projects, triggering anger from New Jersey Governor Phil Murphy.

Podesta, who oversees implementation of Biden's landmark climate-change law, the Inflation Reduction Act, said early project proposals like Orsted's were hit with high interest rates and supply chain challenges, making U.S. project development around 25% more expensive than in Europe.

Those costs will come down "over time, as more investment happens," he said.

"We remain optimistic that at the end of the day it will be a good-news story and we'll get these projects on track."

Orsted CEO Mads Nipper, on a call with analysts the day after announcing the cancellation, pointed to "significant delays on vessel availability" which would have slowed the project down several years.

Podesta also said he spoke with Murphy after the decision.

"Even though the economics have become more challenging than they were a year or two ago, I think they're still basically... on track and the region needs the power," he said.

"We're going to ensure that there is success there and we're trying to do everything we can to make that happen."

(Reuters - Reporting by Valerie Volcovici; Editing by Rod Nickel)