On Jan. 20, Donald Trump’s first day in office, the president wasted no time delivering a death knell to the offshore wind industry. 

He signed an executive order that stopped all new approvals, and renewals, of wind energy projects on federal lands and waters, citing “consequences of which may lead to grave harm — including negative impacts on navigational safety interests, transportation interests, national security interests, commercial interests, and marine mammals.” Or as Trump said during a post-inaugural rally the same day, “We’re not going to do the wind thing. Big, ugly windmills, they ruin your neighborhood.”

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Just two weeks after Trump’s order, New Jersey abruptly canceled the Atlantic Shores project, which was poised to become the state’s first offshore wind development. In a statement, Gov. Phil Murphy, who’d set a goal to achieve 100% clean energy in New Jersey by 2035, called the industry a “once-in-a-generation opportunity to create tens of thousands of jobs, drive an entirely new manufacturing supply chain, and secure energy independence,” but acknowledged that the offshore wind industry “is currently facing significant challenges, and now is the time for patience and prudence.”

Despite the setbacks, offshore wind experts continue to be hopeful. While the Atlantic Shores cancellation is “a disappointing outcome, it is important to remember that one offshore wind project is not the whole industry,” says Kris Ohleth, executive director of the Special Initiative on Offshore Wind, a wind policy think tank.

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Over the last quarter century, wind has grown to become the largest source of renewable electricity in the country, its power-generating capacity jumping from 2.4 gigawatts in 2000 to 150.1 gigawatts in April 2024, according to the US Energy Information Administration. More than 73,000 wind turbines have already been constructed, generating 153,000 megawatts or enough to power 46 million homes, according to clean energy trade group American Clean Power. In states like Iowa and South Dakota, over half of their electricity comes from wind.

But over the last few years, the industry has taken hit after hit, with everything from broken contracts and canceled wind farms to rising inflationary costs and supply chain issues. How did things go so wrong for the offshore wind industry? And is there any hope it might recover?

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Back in 2016, Denmark’s Ørsted, one of the largest renewable energy companies in the world, launched the very first commercial wind farm in the US. But Ørsted has gotten cold feet in recent years, first canceling two wind farm projects in 2023 in New Jersey, Ocean Wind 1 and Ocean Wind 2, citing rising inflation and supply chain bottlenecks.

On Feb. 5, just weeks after Trump’s executive order, Ørsted cut its companywide investment budget — created with the goal of installing up to 38 gigawatts of renewable energy capacity by 2030 — by 25%. Other heavy hitters in wind energy, including Equinor and BP, have canceled contracts for new offshore wind projects over the last year, despite losing millions in penalties. Shell pulled the plug on offshore wind projects in Massachusetts, South Korea, Ireland, France, and most recently, a $1 billion wind farm off the New Jersey shore. As Henrik Andersen, the CEO for Vestas Wind Energy Systems, told investors during a recent earnings call, offshore wind in the US “has come to a stop, more or less with immediate effect.”

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Depending on who you ask, everyone has a different explanation for the dramatic decline of offshore wind, which was showing cracks long before Trump took office. Many insist that the blame is entirely financial.

“Like many global industries, offshore wind is still dealing with the fallout of the inflation and supply chain challenges initiated in part by the pandemic,” says Heather O’Neill, the president and CEO of Advanced Energy United, a national trade association representing the advanced energy industry. 

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There have been sharp increases not just in operating and construction costs, but also in the raw materials needed to build turbines. The price of steel, for instance, has risen by 50% in North America and northern Europe since 2019, according to the American Clean Power Association. The cost of copper — wind turbines require about three metric tons of copper for each megawatt of installed capacity — is also hitting record highs. 

Ohleth claims the real culprit in the industry’s setbacks is rising interest rates. “Offshore wind farms require a great deal of upfront capital, and even a half point change in interest rates can have a reverberating impact on the project’s financing,” Ohleth says.

Additionally, “regulatory process and political issues are part of the problem,” says Steven Cohen, Columbia University professor and former executive director of its Earth Institute. “Offshore wind in the US can involve multiple approvals and risky expensive leases of offshore sites.”

There’s also the broken permitting system, which obstructs all sorts of clean energy investments, says Frank Macchiarola, a chief policy officer for the American Clean Power Association. States solicited competitive contracts for new offshore wind projects but didn’t anticipate post-pandemic inflation. “Each offshore wind project represents a multibillion-dollar investment in American infrastructure, and businesses can’t proceed in a landscape of uncertainty about the security of their investments.”

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A more controversial explanation for offshore wind’s fall from favor are the environmental risks. Trump’s executive order mentioned the impact of wind projects “upon wildlife, including, but not limited to, birds and marine mammals.” There have been mysterious whale deaths on the East Coast, with up to 80 humpback whales found dead off the shores of New York and New Jersey in recent years, according to the National Oceanic and Atmospheric Administration. Some, like Greenpeace co-founder Patrick Moore, believe offshore wind is responsible, blaming the sound pulses used to construct the towers for creating a “death zone” for whales.

“The whale strandings are tragic,” says Macchiarola. But unusual mortality events have been happening since 2016, “well before offshore wind activity was taking place.” Experts agree that despite politically motivated theories suggesting a link between whale deaths and offshore wind, it’s more likely these whales were caught in fishing nets or hit by passing ships, caused by changes in their migration brought on by climate change. Still, the p.r. damage is non-deniable.

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As for birds, most studies found that an average of 1.3 birds died per megawatt of wind capacity every year, or roughly 200,000 birds annually based on the total wind power capacity in the US. By contrast, around 2.4 billion birds are killed by cats every year, and 600 million die from collisions with glass buildings, according to the US Fish & Wildlife Service. 

“There has been an abundance of misinformation being intentionally spread by people who will financially benefit by offshore wind energy not being developed,” says Christopher Niezrecki, the director of the Center for Energy Innovation at the University of Massachusetts at Lowell. Despite the emergence of a new cadre of pro-business environmentalist groups, “many of these groups or people who spread this information are supported by the fossil fuel industry.”

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There’s also the matter of China, which has been dominating the wind turbine manufacturing market. By the end of 2023, Chinese organizations controlled 43.2% of the world’s installed wind energy capacity. “This is largely because they need electricity for their huge population,” says Niezrecki. It also helps that around 95% of the rare earth permanent magnets used to operate offshore wind come from China. 

They’re also driving innovation, “either quickly catching up to the US companies’ technology or even surpassing it,” says Niezrecki. If the US continues to put the brakes on offshore wind technology, “China will continue to win this race,” says Macchiarola. 

But there’s reason for optimism. While the executive order and the domino effect of cancellations of offshore wind projects is a major setback, “in the long run, the US offshore wind industry is here to stay and will grow because of the need for electricity,” says Niezrecki. “Having a diversified energy portfolio that includes offshore wind energy just makes sense.”

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It’s not all bad news. There are still five offshore wind projects in construction in the United States — including Vineyard Wind in Massachusetts, South Fork Wind in New York, and Sunrise Wind just east of Montauk Point — and those projects will “continue to move forward and will be delivering clean and reliable electricity to the grid in the coming years,” says Ohleth. “In fact, offshore wind projects are the only shovel-ready projects in our region that can help support our growing economy.”

Macchiarola also has hope that this isn’t the end, despite the cavalcade of bad news for the industry and a White House focused on a return to fossil fuels. “To keep the lights on and enable economic growth, America needs more energy, not less,” he says. “And it’s going to take all kinds of energy to do it. Offshore wind can deliver vast amounts of energy to where it is needed most.”