US judge rules Trump cannot block Rhode Island offshore wind project

By Jan Wolfe and Nichola Groom

(Reuters) -Danish offshore wind developer Orsted can restart work on the nearly finished Revolution Wind project off the coast of Rhode Island, a federal judge ruled on Monday, after President Donald Trump's administration halted the project last month.

The ruling is a legal setback for Trump, who has sought to block expansion of offshore wind in U.S. waters. It is a palpable victory for Orsted, which has been losing $2 million a day since the project was halted on August 22.

Revolution Wind is located 15 miles off the coast. Once completed, it is expected to produce enough electricity to power 350,000 homes in Rhode Island and Connecticut.

Orsted's U.S.-listed shares were up nearly 9% at $11.60 following the ruling by U.S. District Judge Royce Lamberth.

The U.S. Interior Department said it would continue to review the project while work proceeds.

"As a result of the Court’s decision today, Revolution Wind will be able to resume construction as BOEM (the U.S. Bureau of Ocean Energy Management) continues its investigation into possible impacts by the project to national security and prevention of other uses on the Outer Continental Shelf," an Interior spokesperson said.

Attorneys for the Trump administration had argued that the project, located off the coast of Rhode Island, failed to comply with conditions of its permit related to conflicts with national security and scientific ocean surveys.

Revolution Wind disputed those claims.

At the end of a two-hour court hearing in Washington, Lamberth issued a preliminary injunction that blocks the Trump administration from enforcing the order to halt construction.

Lamberth, a senior judge appointed by Republican President Ronald Reagan, said the Trump administration had offered contradictory reasons for issuing its stop work order, and that the explanations offered weeks after the halt were “the height of arbitrary and capricious” government conduct.

He also said Revolution Wind had reasonably relied on government assurances that were withdrawn without due process, imperiling a $5 billion investment.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.”

Orsted and its joint venture partner Skyborn Renewables had asked for a preliminary injunction in a lawsuit they filed earlier this month challenging the U.S. Interior Department's stop-work order.

"Revolution Wind will resume impacted construction work as soon as possible, with safety as the top priority," an Orsted spokesperson said in a statement, adding that it would continue to seek a resolution with the administration.

Rhode Island and Connecticut have also sued the administration over the stop work order.

Connecticut Governor Ned Lamont issued a statement praising the ruling.

"Today’s ruling allowing Revolution Wind to resume work is extremely encouraging for workers and our energy future. We will continue to engage with the federal government on a durable path forward for this project and on shared energy priorities,” Lamont said.

(Reporting by Jan Wolfe and Valerie Volcovici in Washington and Nichola Groom in Los Angeles; Editing by David Gregorio)