Shares in Ørsted rose 6% on Tuesday after a US court cleared the company to resume construction on its near-completed Revolution Wind offshore project, easing concerns over potential multi-billion-dollar losses.
The ruling follows a series of disruptions to offshore wind developments under US President Donald Trump, who has repeatedly criticised wind turbines as costly and inefficient. Ørsted’s case is one of several legal challenges brought by offshore wind developers and US states seeking to overturn the Interior Department’s 22 December suspension of five offshore wind leases, which cited national security concerns.
Revolution Wind, which uses turbines supplied by Siemens Gamesa, is designed to deliver 704 megawatts of power to Rhode Island and Connecticut.
“Now our focus is on safely resuming construction work as soon as possible and moving towards delivering reliable and affordable electricity to 350,000 homes,” Ørsted chief executive Rasmus Errboe said in a statement issued late on Monday following the ruling.
The lease suspension has also affected projects developed by Equinor, including the Empire Wind project off New York, and Dominion Energy’s Coastal Virginia Offshore Wind facility. Equinor shares were up around 3% in early trading. A company spokesperson said Equinor was taking note of the Ørsted decision and was awaiting a court ruling on Empire Wind expected later this week.
Empire Wind, an 810-MW project, was more than 60% complete when construction was halted in late December. Equinor has said that any delay beyond 16 January could lead to the project being terminated, resulting in a potential financial loss of $5.3 billion.
The decision echoes a court ruling in September, when a judge rejected an earlier attempt by the administration to halt Revolution Wind. In both cases, judges found that national security concerns cited by authorities were insufficient to justify suspending the project.
According to Sydbank analyst Jacob Pedersen, the ruling significantly reduces the risk of Revolution Wind being cancelled, an outcome that could have resulted in losses of around 20 billion Danish crowns ($3.12 billion). Analysts said the decision has also raised expectations of a similar outcome for Ørsted’s larger Sunrise Wind project, with JPMorgan noting that markets may already be pricing in a favourable ruling.
Ørsted has been grappling with inflation, higher interest rates and supply chain disruptions, and raised $9.4 billion through a rights issue last autumn to protect liquidity and avoid further credit rating downgrades. The company has also struggled to attract co-investors, particularly for Sunrise Wind, amid political opposition in the US.
In August, S&P Global downgraded Ørsted to BBB, the lowest investment-grade rating. On Monday, Moody’s revised its outlook on the company to negative from stable, citing increased risks that political resistance in the US could delay or derail offshore wind projects. Analysts warned that a further downgrade could raise borrowing costs and weigh on earnings.
