The offshore wind space in the U.S. is set for a period of uncertainty following the re-election of Donald J. Trump on November 5th. While there is still a lack of clarity around his future plans and potential outcomes, Trump's rhetoric on the campaign trail and, importantly, actions undertaken during his previous administration, suggest that development in the space could be headed for a slowdown due to executive action, instability due to the threat of such action, or both.
One of the most pertinent datapoints looking ahead to Trump's second term is the moratorium his administration placed on offshore wind in 2020. While it did not apply to existing leases, the moratorium banned the consideration of new offshore wind and oil and gas leases for exploration, development or energy production off the coasts of Florida, Georgia, North Carolina, South Carolina and Virginia.
That prohibition was set to begin on July 1, 2022 and end on June 30, 2032, however the moratorium was ended under the Inflation Reduction Act of 2022. Given the previous use of this tool, it is possible that areas previously under consideration by BOEM for leasing activities, including in the Central Atlantic, Gulf of Mexico, New York, the U.S. overseas territories and Hawai'i, will be delayed indefinitely following Trump's inauguration.
While the previous moratorium didn't impact existing leases, Trump's rhetoric on the campaign trail preceding the recent election seemed to indicate that broader action on the offshore space, including with respect to existing lease areas, was under consideration during his second term. While it is unclear what actions could be taken to halt under-construction projects or development in existing lease areas, uncertainty alone is likely to cause delays in permitting and procurement and therefore existing project timelines even in the absence of executive action, which will cause project owners, suppliers and state legislatures to reconsider existing plans.
By comparison, the Biden Administration made offshore wind a centerpiece of its energy policy. Overall, the Biden Administration "approved more than 15 GW of clean energy from ten offshore wind projects" resulting from six offshore wind auctions held during the Biden Administration. These auctions were for areas located within the New York Bight, Carolina Long Bay, Morro Bay, Humboldt Call Area, Central Atlantic, the Gulf of Mexico and the Gulf of Maine wind energy areas.
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