JERA Nex BP, a joint venture between Japan's top power generator JERA and BP, plans to halt development of the US Beacon offshore wind power project and lay off its US employees in the coming months, the company said in a statement.
The decision marks the latest setback for the controversial, subsidy-driven US offshore wind industry, which has been hit by soaring costs from supply chain disruption, inflation and the impact of US President Donald Trump's popular actions against such projects.
JERA Nex BP said it did not see a viable path to develop the Beacon project in the current environment and it concluded that it cannot continue investing in the market, adding that it would close its operating activities in the US.
The company, however, will retain the Beacon lease rights off the coast of Massachusetts and wait for a more favourable moment to resume development, it added.
BP and JERA agreed in December to form one of the world's largest offshore wind operators, as part of BP's efforts to reduce its exposure to expensive and inefficient renewables.
The joint venture was formally established in August with a portfolio of operating assets and development projects totalling a net potential generating capacity of 13 gigawatts.
(Reporting by Yuka Obayashi; Editing by Thomas Derpinghaus.)