The first U.S. utility-scale offshore wind farm entered service on March 14 about 35 miles off the coast of Long Island, with the promise of generating enough power for about 70,000 homes at full capacity.

The 12-turbine, 130-megawatt South Fork Wind project is a joint venture between Denmark's Orsted and New England-based electric utility Eversource.

New York aims to reach 70% renewable energy by 2030 and to install nine gigawatts of offshore wind by 2035, and state Governor Kathy Hochul lauded the project as bringing it closer to those goals. "This is just the beginning of New York's offshore wind future," she said.

But the startup comes up at a time the offshore wind business has been plagued by rising costs tied to inflation, interest rates and supply chain constraints, forcing companies to write down assets and exit projects.

Eversource is one of a number of energy companies to recently announce it was exiting the offshore wind business. It plans to sell its stake in South Fork to Global Infrastructure Partners.

The uncertainty over offshore wind could jeopardize plans by U.S. President Joe Biden and several states, including New York, to meet their goals to decarbonize the power grid in an effort to fight back climate change.

Earlier this week, European energy firms Equinor and BP terminated their agreement to sell power to New York state from their proposed Empire Wind 2 offshore wind farm, citing rising costs and logistical challenges.