By Scott DiSavino and Nichola Groom
(Reuters) — U.S. President Joe Biden's plan to deploy 30,000 megawatts (MW) of offshore wind by 2030 is still possible, although not easy, the CEO of Orsted (CSE:ORSTED), the world's largest offshore wind developer, said on Monday at the Climate Week NYC event in New York.
The remarks by Orsted CEO Mads Nipper come as soaring costs and supply chain delays have increasingly cast doubt on the Biden administration's goal, a cornerstone of its plan to fight climate change. The Danish company said at the end of August that it may see U.S. impairments of $2.3 billion due to the market challenges.
«We’ve seen dark clouds gather,» Nipper said, noting that interest rates going from largely 0% to 4%, which is having a «very dramatic impact on renewables because the fuel of the renewable industry is capital.»
«We don’t need gas or oil or coal. It's capital and that overnight has become significantly more expensive,» Nipper said.
Other challenges include «financially fragile» supply chains, «relatively uncertain policy frameworks,» and rising costs for «everything we need» from turbines to foundations and substations, Nipper said.
Policymakers and the industry need to accept that «for a little while the price of renewable power will have to go up, but we will bring it down again,» Nipper said.
The Biden administration has passed lucrative subsidies aimed at helping companies build new offshore wind power capacity to help decarbonize the power sector and revitalize domestic manufacturing.
But offshore wind developers have said that certain tax credits in the Inflation Reduction Act, Biden's landmark climate change law, are insufficient and are lobbying for less stringent rules around qualifying forRead more on investing.com