Danish utility Ørsted has passed a milestone for its planned Ocean Wind 1 offshore wind project off the state of New Jersey as it has begun work on laying onshore cables, Recharge News reports.

The project, which is planned to have a capacity of 1.1 gigawatts (GW), received final approvals from the state and federal government in September.

However, Ocean Wind 1 is challenged by several issues. Back in August, Ørsted itself flagged large write-downs in the value of its US offshore portfolio. Ocean Wind 1 was mentioned twice.

Once in relation to write-downs of up to DKK 5bn (USD 713.1m) on three projects, the other two being Sunrise Wind and Revolution Wind, due to supply chain delays. The other was in relation to a potential DKK 6bn write-down on Ocean Wind 1 and Sunrise Wind if Ørsted fails to obtain the maximum federal tax credit of 40% versus 30%.

New Jersey recently passed a new state law that allows Ørsted to retain federal tax credits to make the project viable. However, in 2019 when Ørsted won the right to build Ocean Wind 1, the state was required to receive the federal tax credits.

Opponents of the new law have filed a civil lawsuit against the state of New Jersey to have it set aside.

Construction of the 98 GE wind turbines for Ocean Wind 1 is scheduled to begin in 2024 with the wind farm expected to be operational by 2026. Ocean Wind 1 is currently the largest fully permitted offshore wind farm in the US.

(Translated by DeepL with additional editing by Christian Radich Hoffman)