As a result of the rescheduled timetable, the project will now find it hard to start construction in 2020 as planned, noted Rachel Shifman, North American wind analyst at consultancy BloombergNEF.
"While we need to analyse what a longer permitting timeline will mean for beginning construction, commercial operation [of 800MW Vineyard Wind 1 Vineyard Wind 1 (800MW) Offshoreoff Martha's Vineyard, Massachusetts, USA, North America Click to see full details] in 2022 is no longer expected," said Lars Pedersen, CEO of Vineyard Wind.
It remains unclear what the delay might mean for the project's eligibility for the expiring investment tax credit (ITC), which is being phased out.
It is currently worth 18% of capital expenditure for projects that start construction by the end of 2020 or have met — as Vineyard did — the 5% "safe harbour" standard before the end of 2019.
Vineyard Wind had been hoping to carry a 24% tax credit for phase 1 and 18% for phase 2.
The company is in talks with the government concerning an extension because of unexpected circumstances that are delaying the project.
A Vineyard spokesman added: "The company is communicating with the Department of the Treasury regarding opportunities and strategies to preserve ITC eligibility for the Vineyard Wind 1 project and other similarly situated projects that may be delayed due to unforeseeable regulatory action."
Originally, the entire Vineyard site — located south of Martha's Vineyard — was to come online in two phases in 2021-2022, but the permitting process had already been delayed in 2019.
The two-phase 800MW Vineyard Wind project is owned by Avangrid Renewables and Copenhagen Infrastructure Partners.
Elsewhere, president Donald Trump has increased federal government spending on offshore renewable energy.
The proposed 2021 budget, unveiled on 11 February, includes adding around $5 million to the Bureau of Ocean Energy Management's budget. This would bring its renewable energy budget to $26.5 million, up from the current $21.3 million.
The Business Network for Offshore Wind (BNOW), an industry group, said this hike could allow for greater development of offshore wind along US coastlines and additional resources to maintain project reviews.
"The White House's focus on offshore renewable energy as an economic development opportunity shows they understand America's growing demand for offshore wind energy," said BNOW president Liz Burdock.
