Trump's broadside Earnwind industry places projects that could put millions of homes at risk

President Donald Trump has pledged to unleash US energy control, but his drastic executive order targeting wind power is a risky project that will generate enough electricity for millions of American homes Place a pipeline of.

The order issued by Trump in his office on his first day paused new offshore wind leases in US coastal waters indefinitely, and halted new permits by the time the review was completed. According to data from consulting firm Aurora Energy Research, the orders are putting proposed projects at risk on the East Coast, which still doesn't protect 32 gigawatts of electricity.

“At this point, it's really hard to see how any of these projects can move forward,” said Artem Abramov, director of new energy research at consultant Tristad. Like Aurora, Rystad estimates that roughly 30 gigawatt projects on the US East Coast are at risk.

According to CNBC analysis of Energy Information Administration data, these projects, when realized, provide enough combined power for more than 12 million homes in the United States. According to Aurora, the order is not expected to affect the project under construction totaling around 5 gigawatts.

Trump abandoned the commitment made during the Biden administration to combat climate change and retracted the United States for the second time from the Paris Agreement. He focused on improving fossil fuel production, opening up US coastal waters to oil and gas leases and withdrawing those waters for wind.

Trump's orders put efforts at mid-Atlantic and Northeastern states at risk, decarbonizing the electric grid away from fossil fuels. For example, New York, New Jersey and Virginia have adopted ambitious clean energy targets at the state level. But they are too north to rely on solar with batteries for power, Abramov said.

“If you want to achieve a completely fossil-free future in New York, New Jersey, New Jersey and Virginia power generation, if that's the ultimate goal, there's not much to replace offshore winds,” Abramov said. Ta.

According to Rystad and Aurora, the order could ultimately force the state to rely more on carbon-generating natural gas. However, it is virtually impossible for states like New York to achieve climate goals and ensure proper energy supply, particularly in the metropolitan area of ​​New York City.

The power project, which will wait until 2027 to connect to the electric grid in lower New York, is almost entirely wind and transmission, Hoos said.

“Unless there is a significant reform, or there is a kind of fast truck to bring that gas online, there is virtually no chance of bringing new gas online in the next 18-24 months.

But more natural gas outbreaks are likely to be built behind Trump's policies in a decade, Hoos said. Investor sentiment was already moving towards the gas before the election results, partly due to the need for reliable authority to meet demand from artificial intelligence data centers.

Two weeks after Trump's order, New Jersey has now opposed moving forward with the Atlantic Shores project. The state Utility Commission cited the European Petroleum Major as “uncertainty driven by federal government actions and permits.” shell It will be drawn from the project.

“The offshore wind industry is currently facing major challenges and it's time for patience and prudence,” Gov. Phil Murphy said in a statement in support of the board's decision.

Murphy, who set the goal of achieving 100% clean energy in New Jersey by 2035, said, “The Trump administration will partner with New Jersey to reduce consumer costs, promote energy security and provide good energy security. I wanted to create work in payment construction and manufacturing.”

The US offshore winds stopped more or less immediately in the wake of Trump's order.” Vestas Wind Energy Systems CEO Henrik Andersen told investors about the February 5th revenue call. Vesta, Denmark, is one of the world's leaders in wind turbine manufacturing and service.

Trump's order has deepened the challenges of an industry that has already faced uncertain outlook after years of growth.

By April 2024, the US has seen a surge in power generation capacity of 2.4 gigawatts over the past 25 years to 150 gigawatts in the last 25 years, according to data from the Energy Information Agency. Generation from the Wind reached records that month, surpassing coal-fired power. Wind currently accounts for around 11% of US power generation.

However, the industry is struggling with supply chain bottlenecks and high interest rates. Offshore winds were already the most expensive form of renewable energy, Abramov said. According to Hoos, U.S. developers face a lot of cost certainty due to the challenges of accumulating in water, as opposed to land.

“The industry wanted costs to go down,” Abramov said. “We don't see any projects in the US that can achieve lower levels of energy costs.”

Denmark's Austrad, the world's largest offshore wind developer, decided on February 5th to abandon its target of installing a renewable energy capacity of up to 38 gigawatts by 2030. Orsted had cut its investment programmes to a range of around 25% by the end of the decade. Of the 270-200 billion Danish crowns (approximately $29-$32 billion), it was down from the 270 billion crowns.

Orsted's sunrise wind and revolutionary wind power projects should not be affected by Trump's orders during construction off the coast of New York and New England, respectively, CEO Rasmus Errboe said the company's February 6 revenue call He told investors. However, future developments may be at risk.

“We're totally committed to moving them forward and bringing them to their commitment,” Ellerbo said. “I don't think the executive order will affect assets under construction, but of course, it's a potentially different situation for assets under development.”

Also, this order should not affect wind power off the Virginia coast, the largest project under construction in the United States at 2.6 Gigawatts of Power.

““When it comes to Virginia's energy, it will be the most inflationary action that could be made with regard to Virginia's energy,” Blue said. “

In a statement on January 20, America's Clean Power, a wind industry lobby group, described Trump's order as a comprehensive measure of risking domestic energy development and harming American businesses and workers. did. The president's orders contradict the administration's goal of reducing bureaucracy and unleashing energy production, ACP CEO Jason Gourmet said in a statement.

The ACP is currently trying to clarify from the Trump administration how the executive order is implemented, said Frank McCiarola, the group's chief advocacy officer. For example, it is unknown when a review of permits and lease practices is complete, Macchiarora said.

A spokesman for the Department of Home Affairs said the department was implementing Trump's executive order when asked to comment on a detailed list of questions. When asked when a review of permits and lease practices would be completed, the spokesman said the estimates were hypothetical.

The wind industry is working to work with the Trump administration, helping the president move towards the energy control agenda and having a key role on its agenda that renewable energy plays on its agenda as the largest new source of electricity in the United States. He claims, Macchiarora said.

“When past administrations chose to curb US energy development, which has been considered almost universally wrong,” Macchiarora said.

Land wind permits have also been suspended with screenings waiting for reviews, but it is unlikely that some of the industry will face a major impact, said Abramov of Rystad. He said that onshore wind farms are being built on private land, not almost entirely federal land. The market is already saturated, and adding capacity is heavily dependent on building more energy storage in the first place, analysts said.

However, offshore winds were seen as a much less mature market in the US and as a major growth opportunity for the industry, Abramov said. But it appears to be changing rapidly.

“They don't see the US as a market for continuous offshore wind expansion as long as this order is in place,” analysts said.

-CNBC's Gabriel Cortez contributed to this report.