New York Governor Hochul's Veto Imperils Climate Targets By Blocking Offshore Wind Farm

New York Governor Kathy Hochul has vetoed a bill that would have expedited the construction of an offshore wind farm off the southern coast of Long Island. The multi-billion-dollar project, which already faced delays, must now navigate an uncertain regulatory environment that threatens the project's survival, as well as New York's clean energy goals more broadly.

"It is incumbent on renewable energy developers to cultivate and maintain strong ties to their host communities,'' Hochul wrote in her veto address. A substantial community organizing effort successfully lobbied against the wind farm's construction.

The Empire Wind II project, jointly operated by Norway's state-owned oil and gas company, Equinor and British Petroleum (BP), aims to power 1 million homes at full operation. BP paid Equinor $1.1 billion for its 50% stake in the project in 2020. The wind farm, which was the second of five planned offshore facilities in New York, was viewed as a critical step toward meeting the state's ambitious emission reduction targets of 70% electricity generation from renewable sources by 2030 and 100% by 2040.

In contrast to the U.S. at large, New York's energy matrix has seen a shift toward fossil fuels in recent years. Natural gas made up 51% of electrical generation in June 2023, up from 37% on average in 2019. New York's pursuit of a fully renewable grid was set back by the closure of Indian Point nuclear facility's final reactor in 2021; the state's lost power generation was offset by increased natural gas capacity, rather than wind, solar, hydroelectric, or other nuclear sources.

Multinational renewable energy developers have recently expanded their operations in New York state but have encountered substantial obstacles from a variety of regulatory actors. Proponents of clean energy in New York fear that the state will entirely miss its carbon emissions targets without a rapid escalation of renewable capacity.

Molly Morris, President of Equinor Renewables Americas, said in response to Hochul's veto of the Empire Wind II-related bill, "This decision undermines New York's commitment to the energy transition and the role offshore wind must play in achieving the state's renewable energy mandates." Governor Hochul's office did not reply to a request for comment.

In electronic trading before the opening of the New York Stock Exchange today, Equinor's stock was down 0.9% at $33.56, and BP's was down 1.16% at $39.15.