BP and Equinor Assess the Challenges of the U.S. Offshore Wind Industry

BP's head of renewables said the US offshore wind industry was "fundamentally flawed". BP and its partner Equinor plan to develop huge projects off the New York coast after writing down their value by $840 million.

Share:

BP et Equinor

Comprehensive energy news coverage, updated nonstop

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access • Archives included • Professional invoice

OTHER ACCESS OPTIONS

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

FREE ACCOUNT

3 articles offered per month

FREE

*Prices are excluding VAT, which may vary depending on your location or professional status

Since 2021: 35,000 articles • 150+ analyses per week

The offshore wind industry is one of the fastest-growing energy sectors, but it is currently experiencing a series of major setbacks in the USA. Equipment reliability problems, supply chain difficulties and significant cost increases hampered its development.
Anja-Isabel Dotzenrath, Head of Gas and Low Carbon at BP, highlighted several problems in the US industry, including permitting challenges, the time lag between signing power purchase agreements and project construction, and a lack of inflationary adjustment mechanisms. “Fundamentally, offshorewind in the US is failing,” Dotzenrath told a Financial Times energy transition conference in London. “There needs to be a fundamental reset in terms of speed of permitting, security of permitting, etc.”

BP and Equinor’s efforts to find a solution

BP and Equinor are currently examining a new 10-point proposal put forward by US regulators. This proposal would allow companies to re-bid for projects under a “fast-track” process. Dotzenrath commented, “There is a way forward, but it’s a difficult one.”
These developments follow New York State’s rejection of the companies’ request to upwardly revise payments received by developers under power supply contracts for giant projects. Over the past week, BP has written down $540 million and Equinor has taken a $300 million write-down on their Empire and Beacon offshore wind projects, with a combined capacity of 3.3 gigawatts, capable of powering 2 million homes. BP had paid Equinor $1.1 billion in 2020 for a 50% stake in the company.

The Rising Costs of Offshore Wind Projects

Claudio Descalzi, CEO of Italian energy company Eni, also voiced his concerns at the conference. He said that development costs for new offshore wind projects had recently doubled. “It’s very difficult to realize new offshore wind projects,” said Descalzi.
[Conclusion] In conclusion, the U.S. offshore wind industry faces significant challenges, including permitting issues, construction schedules and rising costs. BP, Equinor and other players in the sector are looking for solutions to revive this vital industry for the energy transition. The road ahead looks difficult, but there is still hope for the US offshore wind industry.

The Australian government has granted environmental approval for the 108 MW Waddi Wind Farm, a Tilt Renewables project with construction costs exceeding $400mn.
The 180 MW Nimbus wind project enters its final phase of construction in Arkansas, with commercial operation scheduled for early 2026.
Faced with market uncertainty in Europe, Siemens Gamesa pauses a planned industrial investment in Esbjerg, highlighting structural difficulties in the offshore wind sector.
Institutional deadlock in France delays tenders and weakens the offshore wind sector, triggering job cuts and major industrial withdrawals from the market.
The Lithuanian energy group has signed a EUR 318 million financing agreement for its 314 MW wind project, the largest in the Baltic states.
German group BayWa r.e. has tasked Enercoop Bretagne with implementing a citizen investment scheme for its planned wind farm in Plouisy, aiming for shared governance and stronger local involvement.
US wind capacity fell in Q2, but developers anticipate a sharp increase by late 2025, with 46 GW of new capacity forecast by 2029 and a peak in 2027.
Engie has signed a renewable electricity supply contract with Apple covering 173 MW of installed capacity in Italy, with commissioning scheduled between 2026 and 2027.
Renova a soumis une méthodologie d’évaluation environnementale pour un projet éolien terrestre de 280MW à Higashidori, renforçant son positionnement sur les technologies renouvelables au Japon.
With a 300 MW partnership signed with Nadara, Q ENERGY exceeds 1 GW of wind repowering projects in France, reinforcing its position in a market driven by public investment dynamics.
The acquisition of Cosmic Group by FairWind consolidates its position in Australia and marks a strategic expansion into New Zealand and Japan.
Danish manufacturer Vestas has paused construction of its planned facility in Poland, originally set for 2026, citing weaker-than-expected European offshore wind demand.
British operator Equitix has been selected to take over transmission assets of the Neart na Gaoithe offshore wind farm, a £450mn ($547mn) project awarded under Ofgem’s tenth tender round.
Energiequelle GmbH has launched replacement work for old turbines at its Minden-Hahlen site, aiming for long-term structural maintenance with the installation of three new 200-metre machines.
GE Vernova will equip the Ialomiţa wind farm with 42 turbines of 6.1 MW, strengthening its presence in the European onshore wind sector with a 252 MW project in partnership with Greenvolt.
Eversource Energy posts a one-time $75mn charge linked to unforeseen costs in the Revolution Wind project, while tightening its 2025 earnings forecast.
The Renewables Infrastructure Group has signed a ten-year power purchase agreement with Virgin Media O2 for its onshore wind farms in the United Kingdom, ensuring price stability for both parties.
Eight local associations in Normandy and Hauts-de-France will receive a total of €120,000, financed by revenues from three RWE wind farms, to support public-impact projects in 2025.
CWP Europe formalised two major projects in Albania and Montenegro with backing from the European Commission, reinforcing the Balkans’ integration into the European energy market.
Elawan Energy secured two wind power projects totalling 92MW in Romania through a long-term public contract, strengthening its presence in the region with operations scheduled to begin in 2028.

All the latest energy news, all the time

Annual subscription

8.25$/month*

*billed annually at 99$/year for the first year then 149,00$/year ​

Unlimited access - Archives included - Pro invoice

Monthly subscription

Unlimited access • Archives included

5.2$/month*
then 14.90$ per month thereafter

*Prices shown are exclusive of VAT, which may vary according to your location or professional status.

Since 2021: 30,000 articles - +150 analyses/week.