Tax credit cuts in Trump’s megabill imperil two fully approved wind… | FROUSA Media

On June 30, after an exhausting round of late-night negotiations, Delaware state legislators passed a bill to effectively green-light the Southeast’s second offshore wind farm. Within days, lawmakers in Washington passed legislation that may doom its future.

MarWin, the first phase of a 114-turbine project off the Delmarva Peninsula, is slated for installation in 2028 with onshore construction possibly starting next year, but that timeline is perhaps unrealistic, said Harrison Sholler, an offshore wind analyst with BloombergNEF. MarWin doesn’t have its financing in place yet to underwrite construction and, to make matters worse, Congress just unleashed a crushing new deadline.

When President Donald Trump signed the ​“Big, Beautiful Bill” on Friday, he dramatically shortened the window in which offshore wind projects can qualify for tax credits that offset up to 30% of their costs. The law now requires new wind farms be ​“placed in service” by the end of 2027 or begin construction by July 4, 2026, to qualify.

“We don’t predict any new offshore wind projects starting construction … at least in the next four years,” Sholler told Canary Media two days before Congress passed the bill.

He described Republicans’ tightening of the tax credit — from an original deadline to start construction by 2033 or potentially later, to this one-year sprint — as the final nail in the coffin for offshore wind farms that are fully approved but not currently underway. Two projects — MarWin near Maryland and New England Wind off the Massachusetts coastline — float in this gray zone, and are now vulnerable to being put on ice indefinitely.

A BloombergNEF report released in April states that losing the Inflation Reduction Act tax credits, known as 45Y and 48E, would be ​“devastating” for U.S. projects already in the pipeline. Analysts estimate that the electricity produced by offshore wind farms that qualify for the credits costs on average 24% less over a project’s lifetime.

That April report predicted ​“all but the most advanced projects [will] pause development activities.” Now, with tax credits officially rolled back, prospects for offshore wind appear even more dim.

“If you take away the tax credits, it doesn’t make much sense to develop an entirely new sector,” said Elizabeth Wilson, a professor of environmental studies at Dartmouth College who studies offshore wind policy.

America’s offshore wind sector is still in its infancy. While the U.K. has already built over 50 wind farms in its waters, America has only completed one large-scale project: South Fork Wind, located off the coast of Long Island, New York.

Trump issued an executive order on Inauguration Day that froze all offshore wind permitting and leasing pending a federal review. Seemingly safe from the president’s ire at the time were eight projects, including MarWin, that already had all their federal permits in hand. Since then, at least one of those permitted projects — the 2.8-gigawatt Atlantic Shores project off the New Jersey coast — has fallen apart. Five are currently under construction.