Offshore Wind Project Halts, $50 B at Risk as DOI Pauses 5 Ørsted & Dominion Projects and 165 Onshore Stalls (2025 to 2026)

Offshore Wind Project Risks, Ørsted and Dominion See 5 Major Halts and $50 B in Jeopardy

The U.S. wind energy industry’s growth trajectory reversed sharply in 2025, shifting from construction and investment to litigation and survival as federal actions created extreme regulatory risk. Before 2025, the sector was on a path toward large-scale commercial deployment, but the focus has since pivoted to defending legally-permitted and active projects from administrative shutdowns.

• On December 22, 2025, the Department of the Interior (DOI) halted five major offshore wind projects under construction, including Ørsted’s Revolution Wind and Dominion Energy’s Coastal Virginia Offshore Wind. The action, which cited classified national security risks related to radar interference, immediately imperiled over 9 GW of capacity capable of powering nearly 2.7 million homes.
• The administrative blockade expanded to onshore wind, with the Pentagon effectively freezing the national security review process for new developments. This “de facto moratorium” has stalled at least 165 onshore projects, representing approximately 30 GW of potential clean energy capacity and threatening over 120, 000 jobs.
• In response, the industry’s primary activity has become legal defense. A coalition led by the American Clean Power Association filed a lawsuit in June 2026 against the Pentagon to end the review freeze. Developers for all five halted offshore projects secured judicial relief by February 2026, allowing them to resume work despite ongoing administrative opposition.

$14.7 B+ in Cancellations, Ørsted and Invenergy Abandon GW-Scale Projects

A combination of political hostility in the U.S. and adverse global economic conditions triggered a wave of gigawatt-scale project cancellations starting in 2025, erasing billions in planned investment and future renewable capacity. While U.S. political risk was the primary driver for domestic cancellations, international projects were undone by financial pressures.

• In the U.S., Invenergy formally withdrew its long-struggling 2.4 GW Leading Light Wind project in November 2025, citing economic and political headwinds. The administration also reached a $765 million deal to cancel four of Invenergy‘s offshore wind leases, while developers for the Bluepoint Wind and Golden State Wind projects agreed to voluntarily terminate their leases in April 2026.
• Internationally, economic factors forced major developers to abandon projects. Ørsted announced in May 2025 it would discontinue its 2.6 GW Hornsea 4 project in the UK, incurring up to $650 million in costs due to a challenging business case. In December 2025, RWE canceled its 2 GW offshore wind project in Australia, deeming it commercially unviable.
• The trend extends to nascent technologies, highlighting the difficulty of scaling capital-intensive energy projects. BP scrapped its flagship blue hydrogen facility in the UK and paused a carbon capture project in Indiana, while Air Products exited a green liquid hydrogen plant in New York as part of a strategic shift.

Table: Major Clean Energy Project Cancellations & Halts (2025-2026)

U.S. vs. International, Ørsted and RWE Face Divergent Regional Pressures

While political and regulatory actions drove project halts across the U.S. in 2025, international cancellations in the UK, Australia, and Japan were primarily caused by economic and market-based pressures. This divergence highlights a split in the risk profiles for global wind energy markets.

• The U.S. market became defined by top-down political risk, with federal actions creating a uniquely hostile environment. The DOI and Pentagon interventions impacted projects across the country, from the five major offshore wind farms on the Atlantic coast to over 165 onshore projects, including 54 stalled developments in Texas alone.
• In established international markets, the primary challenges were economic. Ørsted‘s cancellation of the 2.6 GW Hornsea 4 project in the UK was attributed to “adverse market conditions, ” not political opposition. Similarly, RWE’s exit from a 2 GW project in Australia and Mitsubishi‘s withdrawal from three projects in Japan were driven by assessments of commercial viability and profitability amid rising costs.
• This split demonstrates that while U.S. developers must now prioritize navigating political and legal threats, their international counterparts are focused on managing supply chain inflation, interest rate exposure, and intense market competition to maintain project profitability.

US Wind Generation Declined in 2023

The 2023 decline in U.S. wind generation illustrates the unique regional pressures facing the American market. While global capacity is growing, this U.S.-specific dip underscores the challenges discussed in this section, such as policy uncertainty and grid constraints, which create a different operating environment compared to more stable international markets.

(Source: CarbonCredits.com)

Offshore Wind Commercial Viability, Ørsted Projects Undermined by Non-Technical Risk

Despite being a technologically mature and commercially scalable solution, offshore wind deployment in the U.S. has been artificially stalled by regulatory and political interventions, while economic headwinds challenge its financial viability in established international markets. The events of 2025-2026 confirmed that technical readiness does not guarantee project success.

• Before 2025, the U.S. offshore wind sector was progressing along a predictable commercialization path, with multiple gigawatt-scale projects moving from permitting into construction. This trajectory treated technology and market risk as the primary variables for success.
• The shift in 2025-2026 made non-technical risks the dominant barrier in the U.S. The halt of fully-permitted and under-construction projects, including Ørsted’s Revolution Wind, showed that political opposition could override technical and commercial milestones, making future investment decisions highly uncertain.
• In parallel, international cancellations like Hornsea 4 demonstrated that even with government support, the commercial case for this capital-intensive technology remains sensitive to macroeconomic factors. Persistently high supply chain costs and rising interest rates severely impacted project economics, a key challenge for a sector still working to reduce its levelized cost of energy.

SWOT Analysis, Ørsted U.S. Wind Portfolio Faces Political Threats and Legal Openings

The U.S. wind industry’s strengths in project development and access to capital are now directly countered by the immense political threat from federal actions, creating an environment where legal challenges are the main opportunity for survival. The sector’s inherent weaknesses, such as high capital costs, have been magnified by this new layer of risk.

Table: SWOT Analysis for U.S. Wind Development

Offshore Wind Scenario Modelling, Ørsted Legal Fights Shape U.S. Sector Viability

The U.S. wind sector’s viability in the near term depends almost entirely on the outcome of legal battles against federal overreach, with project developers’ ability to secure and enforce court orders being the most critical signal to watch. The industry’s path forward is no longer determined by market forces but by judicial rulings.

• If the industry’s June 2026 lawsuit against the Pentagon succeeds in forcing a timely restart of security reviews, watch for a rapid unlocking of the 30 GW stalled onshore project pipeline. This would signal that legal recourse can effectively counter administrative delay tactics.
• If the federal government continues to pursue taxpayer-funded buyouts of offshore leases, as was reportedly considered with a $1 billion offer for the Attentive Energy project, watch for a mass exodus of capital from the U.S. offshore market. This would confirm that political risk has become un-investable for developers and financiers.
• If judicial injunctions allowing projects like Revolution Wind to resume construction are consistently upheld against further appeals, watch for a “whipsaw” dynamic where projects proceed in fits and starts. This would create immense stress on supply chains and project financing, even with legal victories.

The questions your competitors are already asking

This report covers one angle of the regulatory and national security risks halting U.S. wind energy projects. The questions that matter most depend on your work.

• What is the outlook for U.S. offshore wind deployment now that national security reviews have become a major risk?
• Are Ørsted and Dominion Energy losing ground in the U.S. offshore wind market after the Department of the Interior’s project halts?
• What is actually happening with the Revolution Wind and Coastal Virginia Offshore Wind projects since judicial relief was granted in February 2026?
• What is the status of the lawsuit filed by the American Clean Power Association to end the Pentagon’s review freeze on onshore wind projects?

This report does not answer these. Enki Brief Pro does.

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