By Avi Salzman

The Trump administration said late on Monday that a major New York offshore wind project can move ahead, a month after the administration inexplicably stopped it.

The White House implied that it had made a side deal with New York Gov. Kathy Hochul to allow a natural gas pipeline into the state in return for the wind farm being built. But Trump's pipeline project remains a long shot, and Hochul's office says she made no deal with the president to approve it.

"No deal on any natural gas pipeline was reached," a Hochul spokesman told Barron's.

For now, there is no clarity for either the offshore wind industry or for the companies that want to build pipelines into the Northeast. In fact, the episode is looking more like an expensive waste of time than a shift in the fortunes of players in the energy industry.

The "winner" of the saga is ostensibly Equinor, the Norwegian energy company building Empire Wind, the offshore wind farm that will sit 15 miles southeast of Long Island and power about 500,000 homes in the state. But Equinor is also a loser because its project was delayed for a month, at a cost of about $50 million a week. Equinor had already started construction and rented vessels, which racked up costly fees as they sat idly by.

On Tuesday, the stocks of Equinor, Iberdrola, and Dominion Energy, which are building offshore wind farms on the East Coast, rose 2.3%, 3%, and 3.2% respectively.

But investors were looking at the Empire Wind reversal as a one-off situation. "It is by no means an all-clear" for offshore wind, said Shawn Kravetz, president and chief investment officer of Esplanade Capital, which invests in renewable energy. Empire Wind and the other projects remain under review by the Department of the Interior even though the stop-work order was lifted. They could be challenged again.

The decision also upset and confused opponents of offshore wind, who have supported Trump's effort to halt permitting for the industry and stop Empire Wind.

"We don't know what prompted this reversal, but I can say that disappointing does not go far enough in describing the reaction," wrote Bob Stern, the president of Save Long Beach Island, a group that opposes offshore wind projects and has sued over the Empire Wind project on environmental grounds. "I think the White House owes those people an explanation."

In response to a question about why the administration changed its stance, the White House sent a link to a post on X by Secretary of the Interior Doug Burgum. "I am encouraged by Governor Hochul's comments about her willingness to move forward on critical pipeline capacity," Burgum wrote, without referring to offshore wind.

The administration hasn't revealed what problems it found with the Empire Wind project, after initially saying there were "serious deficiencies" with its approval. It didn't detail those deficiencies to Equinor either, even after the company has invested more than $2.5 billion in the project, and although the finance minister of Norway, the largest owner of Equinor stock, has lobbied in favor of the project.

Hochul's office said that she spoke with Trump three times over the weekend. In a statement, Hochul said she "reaffirmed that New York will work with the Administration and private entities on new energy projects that meet the legal requirements under New York law."

The implication from all this back-and-forth is that Hochul needed arm-twisting by the White House to buy into a new pipeline. But while previous New York Gov. Andrew Cuomo denied a permit in 2016 to a natural gas pipeline into New York, Hochul's administration has previously approved new natural gas infrastructure, including a controversial pipeline expansion earlier this year. Her office said she would let future pipeline projects be vetted under the normal procedures of the state, which include environmental reviews and analyses of whether more natural gas is necessary.

The most prominent New York pipeline project is the Constitution Pipeline, the one that Cuomo helped block. Trump has said he wants that project to be revived to lower costs for consumers in New York and New England, and that he thinks construction could start as soon as this year.

The pipeline's majority owner, Williams Companies, has said it would only move ahead with the pipeline if it has the support of the region's governors. That would include governors of other states, such as Massachusetts, who would have to be open to paying for more natural gas.

Williams Companies didn't respond to a request for comment on Tuesday about whether it plans to move ahead with the pipeline.

Even if the project has support from the governors, it could still get blocked by environmentalists and landowners. The pipeline's original path ran across private land, and landowners fought in court to keep their property from being taken away.

Environmentalists are also girding for a fight. "If Hochul decides to go down this foolish path, she will be met at every turn by the full force of New York's energized climate movement," said Laura Shindell, New York state director at Food & Water Watch. "She will certainly regret it."

Write to Avi Salzman at avi.salzman@barrons.com

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May 20, 2025 17:27 ET (21:27 GMT)

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