The company said it is canceling its Ocean Wind I and II projects in southern New Jersey, citing supply chain issues and rising interest rates.
Biden-backed wind power company cancels New Jersey projects despite $1B in subsidiesOver and over, the litany of causes is the same: inflation, higher interest rates that drive up capital costs and severe kinks in the supply chain.Seeing that the wild cost increases threaten to make their projects unprofitable, these companies went hat-in-hand to the state’s Public Service Commission asking for increases of 35% to 65% on the price of electricity they hope to generate.
The contracts the wind-energy companies struck with the state sets offshore wind’s price at $118 per megawatt-hour, three times as expensive as gas but still not enough to make turbines turn a profit. This is the danger of letting the government pick winners and losers. Watch the show “Shark Tank,” and you’ll see real investors having to decide whether to risk their own bankroll.
Not having anything of their own at stake dulls their judgment, making them care more about the ideological appeal of a proposal than whether the money picked from the public’s pocket will provide a real return on their investment.
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