Shares in Orsted surged 9% on Tuesday after a US federal court on Monday allowed the Danish energy company to resume construction of its nearly completed Revolution Wind offshore project, which had been halted by the Trump administration last month.
The decision marked a significant victory for Orsted, removing immediate financial pressure and providing a lifeline for the $5 billion project off the coast of Rhode Island.
Orsted shares were among the best performers on the STOXX 600 index, heading for their strongest session since May, while the ruling lifted shares across the European wind energy sector.
Danish turbine maker Vestas and Germany’s Nordex rose between 2.5% and 3.6%, while Siemens Energy gained around 2.5%.
Judge calls halt order ‘arbitrary and capricious’ government conduct
At the end of a two-hour hearing in Washington, US District Judge Royce Lamberth granted a preliminary injunction blocking enforcement of the stop-work order.
Lamberth, a Reagan appointee, criticized the Trump administration’s handling of the matter, calling the explanations given for halting construction “the height of arbitrary and capricious” government conduct.
The judge said Revolution Wind had reasonably relied on government assurances that were later withdrawn without due process, endangering billions in investment.
“If Revolution Wind cannot meet benchmark deadlines, the entire project could collapse,” Lamberth said.
“There is no doubt in my mind of irreparable harm to the plaintiffs.”
Financial impact eased for Orsted; analysts call it positive news
The ruling reduces the financial burden of the construction halt, which Orsted had estimated at nearly $15 million per week in additional costs.
Analysts at Sydbank said the injunction helps Orsted avoid potential impairments exceeding 8 billion kroner ($1.27 billion) and a further $500 million in costs if the project were abandoned.
“This is really positive news,” said Sydbank’s Jacob Pedersen.
“An outright abandonment of Revolution Wind is also significantly less likely now, saving Orsted more than 11 billion kroner in losses and write-downs,” he said.
He added that the decision also improves the outlook for Orsted’s Sunrise Wind project off New York, which had faced knock-on delays due to disrupted vessel scheduling.
JPMorgan said in a note that the ruling highlights the readiness of US courts to step in with protective measures.
“While the best news would be the cancellation of the stop work order and the re-start of the works on a permanent basis, this is still clearly good news in our view,” the broker added.
Project details and outlook
Revolution Wind, a joint venture with Global Infrastructure Partner’s Skyborn Renewables, is already 80% complete.
Offshore foundations and 45 of its 65 wind turbines have been installed.
The project is expected to be fully operational next year and to generate enough electricity to power 350,000 homes across Rhode Island and Connecticut.
In a statement, Orsted said it would resume affected construction work “as soon as possible, with safety as the top priority” and pledged to continue engaging with the administration and other stakeholders.
The company had previously warned that prolonged delays would significantly raise capital expenditure and increase the risk of cancellation.
By late September, the weekly costs were projected to escalate if the injunction was not secured.
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