Shell exits Atlantic Shores offshore wind project
By Bruce Beaubouef, Managing Editor
Shell has reportedly exited the Atlantic Shores offshore wind project, saying that the project no longer fits its capabilities or the returns the company expected. Shell has reportedly written off its $1-billion investment in the project.
The Shell decision to “back away” from the project, as reported by the financial services firm Morningstar, came despite the project having received its Construction and Operations Plan approvals from the US Bureau of Ocean Energy Management (BOEM) on Oct. 1, 2024.
According to Morningstar, Shell told the Associated Press that it is writing off the project because of increased competition, delays, and a changing market. President Trump’s executive order likely played a role in this decision, strongly suggesting a less-friendly regulatory environment for US offshore wind over the next four years. “Naturally we also take regulatory context into consideration,” Shell’s spokesperson Natalie Gunnell said in an email to the Associated Press.
President Trump issued an Executive Order in January that paused offshore wind leasing on the US Outer Continental Shelf and mandated a review of the federal government’s leasing and permitting practices for wind projects.
Shell owns half of the Atlantic Shores offshore wind development through a 50:50 joint venture with EDF Renewables, Atlantic Shores Offshore Wind, LLC.
Following Shell’s announcement, EDF said that it remained committed to advancing the Atlantic Shores project, which called for the construction of two offshore wind farms off the coast of Atlantic City.
But just days after Shell’s announcement, the New Jersey Board of Public Utilities (NJBPU) announced that it had cancelled the bidding process for the state’s fourth offshore wind solicitation, which had included the Atlantic Shores project.
The NJBPU cited uncertainty caused by recent federal actions and Shell’s withdrawal from the Atlantic Shores offshore wind project. The state’s fourth round of offshore wind solicitation was launched in May 2024, initially aimed at awarding between 1.2 GW and 4 GW of capacity.
Christine Guhl-Sadovy, Board of Public Utilities President, said in a statement that two out of three bids had withdrawn, leaving Atlantic Shores as the only bidder. Corio, TotalEnergies and Rise Light & Power consortium, as well as RWE-National Grid venture Community Offshore Wind, had pulled out of the bidding process.
“A number of reasons led to this decision, notably Shell backing out as an equity partner in the Atlantic Shores project and backing away from the American clean energy market, as well as uncertainty driven by federal actions and permitting,” said Guhl-Sadovy.
“The Board concluded that an award in New Jersey’s fourth offshore wind solicitation, despite the manifold benefits the industry offers to the state, would not be a responsible decision at this time.”
New Jersey Governor Phil Murphy also said that he supports the NJBPU’s decision on the fourth offshore wind solicitation, adding that the industry is currently dealing with numerous challenges.
“However, the offshore wind industry is currently facing significant challenges, and now is the time for patience and prudence,” Murphy said. “I support the BPU’s decision on the fourth offshore wind solicitation, and I hope the Trump Administration will partner with New Jersey to lower costs for consumers, promote energy security, and create good-paying construction and manufacturing jobs.”
In September 2022, Governor Murphy had signed an executive order that increased the state’s offshore wind target for 2040 from 7.5 GW to 11 GW.
