(Jan 13): Ørsted A/S shares surged after a US judge ruled work can resume on a wind farm off the coast of Rhode Island while it challenges the US government’s latest attempt to stop offshore projects from being built.
The ruling is a major win for the Danish energy giant in the ongoing fight with the Trump administration over renewable energy. Shares rose as much as 6.6% on Tuesday (Jan 13) in Copenhagen.
The project, almost 90% complete, “would be irreparably harmed” unless work was allowed to continue during the legal fight, US District Judge Royce C Lamberth concluded Monday. In a statement, the Danish company said “the project will resume construction work as soon as possible, with safety as the top priority, and to deliver affordable, reliable power to the Northeast”.
Investors are watching closely after committing US$9.5 billion in new funding for the Danish company last year. Ørsted is emerging from a turbulent period marked by soaring costs and supply-chain bottlenecks. The company found itself at the centre of the crisis, abandoning two US projects, dismissing two top executives and recording multi-billion-dollar writedowns.
The US Interior Department had ordered a 90-day suspension of the project, citing undisclosed national security concerns, but the judge said the government’s claimed national security concerns may have been a pretext to block the renewable energy project.
The administration initially halted work on the US$5 billion Revolution Wind project in August, triggering a crisis for its owners and the industry as the installation was nearing completion. In September, a federal judge allowed construction to continue but a second stop-work order was issued at the end of last year when the Interior Department said the massive turbines may interfere with radar systems.
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Lamberth’s ruling offers hope to developers facing a flurry of US moves to stop offshore wind projects Trump claims “lose money” and “destroy your landscape”. The same judge is considering Ørsted’s request to continue work on its Sunrise Wind project near New York.
“Revolution Wind’s restart is a positive development and supports our view that legal challenges can provide near-term share price support,” Citigroup Inc analyst Jenny Ping said in a note. “That said, risks of further policy intervention and cost inflation remain, given the Trump administration’s concerns on offshore wind.”
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