In a significant blow to New Jersey's ambitious offshore wind energy plans, Shell has announced it is pausing its involvement in the Atlantic Shores Offshore Wind. During its fourth-quarter earnings call, the energy giant revealed it was writing down its investment in the project by a substantial $996 million, signaling serious concerns about its financial viability. "We just don’t see that it fits both our capabilities nor the returns that we would like," Shell Chief Financial Officer Sinead Gorman explained, effectively halting Shell's participation. 

This decision throws the future of Atlantic Shores, a joint venture between Shell and EDF Renewables North America, into considerable doubt. The 2.8 GW project, located around 9 miles off the New Jersey coast, was once considered a flagship venture, touted as the closest offshore wind project to shore along the Eastern Seaboard. However, its proximity to the coast also made it a lightning rod for criticism, drawing fire from New Jersey Republicans and even former President Donald Trump, who publicly targeted the project.

While EDF Renewables has yet to issue a formal statement, Atlantic Shores released a statement asserting its intention to move forward.

“Atlantic Shores is committed to New Jersey and delivering the Garden State’s first offshore wind project. Business plans, projects, portfolio projections, and scopes evolve over time – and as expected for large, capital-intensive infrastructure projects like ours, our shareholders have always prepared long-term strategies that contemplate multiple scenarios that enable Atlantic Shores to reach its full potential. While we can’t comment on the views of shareholders, Atlantic Shores intends to continue progressing New Jersey’s first offshore wind project and our portfolio in compliance with our obligations to local, state, and federal partners under existing leases and relevant permits.”

Shell's decision to step back from Atlantic Shores reflects a broader trend of the company scaling back its investments in renewable energy. Despite previously positioning offshore wind as a central pillar of its net-zero emissions strategy announced in 2020, Shell has steadily retreated from the sector. Rising project costs and investor pressure for higher returns in the traditional oil and gas business have led the company to prioritize "performance, discipline, and simplification," according to a company spokesperson. This includes a focus on "value maximization in key markets where we have an advantaged position." Shell had already sold its stake in a Massachusetts offshore wind project last year, further demonstrating its shifting priorities.

The withdrawal is a significant setback for New Jersey Governor Phil Murphy's ambitious offshore wind energy goals. The state has already faced setbacks in its renewable energy plans, notably the cancellation of the Ørsted project last year. The loss of Shell's backing for Atlantic Shores raises serious questions about the feasibility of the project moving forward and casts a shadow over New Jersey's broader efforts to transition to clean energy sources. The future of Atlantic Shores, and indeed New Jersey's offshore wind industry, now hangs in the balance.

Credit: E&E News

Update (2/3/25): New Jersey has cancelled its fourth solicitation for offshore wind capacity. 

The state's Board of Public Utilities said that while there were three initial bidders for the 1.2 GW to 4 GW solicitation, Corio-Total-Rise joint venture Attentive Energy and RWE-National Grid venture Community Offshore Wind have since pulled out, leaving only Atlantic Shores to submit a best and final offer. 

Shell's decision to pull out of the Atlantic Shores joint venture with EDF contributed to the Board's decision to cancel the solicitation, as well as President Donald Trump's indefinite delay on new federal permitting. 

According to Christine Guhl-Sadovy, from New Jersey Board of Public Utilities, "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.

"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."

Credit: ReNews.biz