Donald Trump despises offshore wind turbines.
I know this for a fact after writing my first book, The Trump Factor: Unlocking the Secrets Behind the Trump Empire.
Back in 2015, when I was researching Trump’s properties, I visited his Scottish golf courses, Turnberry in Ayrshire and Meenie in Aberdeenshire. I was extremely impressed with both, particularly Meenie.
Source: Wide Moat Research
As I ended up writing, “I was overwhelmed by the imposing dunes and rugged Aberdeenshire coastline. It seemed a flawless site for a Trump International property. I have never seen such an unspoiled and dramatic seaside landscape.”
Source: Wide Moat Research
Trump, however, vehemently disagreed with my “unspoiled” assessment. He complained to me directly about 11 wind turbines a few miles offshore in full view of his estate.
I’m not exaggerating when I say they infuriated him.
His spokesman accused Scottish First Minister Alex Salmond of “putting Scotland in dangerous territory by destroying some of its most pristine natural assets.” That included, he told me, the local bird population.
Though, if you ask me, his real concern was sheer aesthetics. He thought the turbines were ugly and ruined the view.
Ultimately, Donald Trump lost that battle. The Aberdeen Offshore Wind Farm, or European Offshore Wind Deployment Centre, still stands today.
But 10 years later, a lot has changed.
Most importantly, he’s president of the United States now. And he’s still waging a war on wind turbines. And he has much more sway than he once did.
And that makes me hesitant about investing in the offshore wind turbine space.
Offshore Wind Farms Were in Trouble Before Trump
On April 23, Barron’s ran an article titled, “Trump Is Targeting Offshore Wind. Many Projects Are at Risk.”
It comes with the byline, “The Trump administration’s move last week to halt a wind project under construction has put the industry in a state of emergency.”
But here’s the very first line it the body of the article: “The offshore wind industry was struggling even before Donald Trump took office.”
Specifically:
In the U.S., there’s only one active large-scale project today – South Fork Wind’s 12 turbines provide power to New York. But the Biden administration approved 10 other projects with the capacity to power millions of homes.
Some of those projects are stalled because of rising supply-chain costs or regulatory uncertainty. Danish wind developer Orsted stopped developing two New Jersey projects last year because of rising costs. Shell has pulled out of two projects on the East Coast too.
Meanwhile, Dominion Energy has constructed 78 of a planned 176 turbine bases off the coast of Virginia. But back in February, it announced that associated costs had jumped almost 10%.
Dominion is also being privately sued on the premise that the government “illegally approved” its “offshore wind project by ignoring glaring and obvious procedural errors that subjects the endangered North Atlantic right whale to further grave harm,” according to the article.
To which Dominion spokesman Jeremy Slayton says that the Bureau of Ocean Energy Management did “an extraordinarily thorough… review of the project.”
Now, it is a fact that the Biden administration was pushing alternative energy projects pretty hard – even to the point of unsustainability. Then again, these are conservative groups suing Dominion. So their public pleas to save the whales are probably secondary at best.
However, one thing we do know is that these turbines can and do break, just like one did off the coast of Martha’s Vineyard last July. The snapped turbine blade spilled fiberglass debris into the ocean, which washed up ashore. I think we can agree that’s sub-optimal.
Source: Vineyard Gazette, Town of Nantucket
I’ll let others argue whether wind energy is an environmental positive or not. But environmental concerns aside, the feasibility of these projects is looking less and less appealing.
Offshore Wind Farms Are in Even More Trouble Under Trump
Offshore wind projects in the U.S. were already failing before Trump took office. And that’s despite full support and encouragement from the Biden administration.
But Trump’s presidency has definitely piled on the problems, starting – but not ending – with the aforementioned legal action earlier this month.
In mid-April, Interior Secretary Doug Burgin ordered Norwegian Equinor to halt work on its Empire Wind 1 project off the coast of New York. The allegation is that Biden-era permits were granted under faulty analysis.
This is after Trump’s Day 1 executive order that suspended all new leases for such ventures in federal waters. So there’s absolutely no doubt that – right or wrong – he can’t stand the structures.
And while I doubt it was his goal when he began implementing tariffs on China, that’s also proving impediment to offshore wind farms.
According to The Heritage Foundation, “Onshore wind farms require eight times the amount of critical minerals as natural gas power plants do. Offshore wind farms require 13 times as much.”
So regardless of whether those “staggering quantities of… materials, such as copper and rare earth metals, are environmentally damaging,” as it accuses, there’s no doubt that they’re largely dependent on Chinese mining. The country produces around 90% of the world’s supply of rare earths.
Therefore, the current trade war between the U.S. and China… including China’s recent move to restrict those exports to the U.S… is making wind energy that much more expensive.
As things stand, I don’t see offshore wind farm investments growing much in the foreseeable future, if at all. There are far more profitable energy plays to take advantage of, ones that don’t have absolutely everything going against them.
In fact, Nick Ward and I are discussing one of them tomorrow on our YouTube channel, The Wide Moat Show. It’s one of 10 sleep-well-at-night stocks, or SWANs, we’re covering in these turbulent times.
Regards,
Brad Thomas
Editor, Wide Moat Daily
MAILBAG
Do you agree with brad that there are more profitable energy plays to take advantage of? Write us at [email protected].