The logo for Orsted can be seen on the jacket worn by an employee as he talks to journalists during a visit to the offshore wind farm near Nysted, Denmark, September 4, 2023. REUTERS/Tom Little/ File Photo

By Jacob Gronholt-Pedersen and Nichola Groom

COPENHAGEN/LOS ANGELES (Reuters) -Danish offshore wind developer Orsted and the states of Rhode Island and Connecticut sued the Trump administration on Thursday, alleging its decision to block construction of the nearly finished Revolution Wind project is illegal.

The separate complaints are the latest twist in a saga that started last month when U.S. officials issued a stop-work order to Revolution Wind, citing unspecified national security concerns. The order forced the suspension of a project that was 80% complete with all offshore foundations in place and 45 out of 65 wind turbines installed.

"The stop-work order was issued without statutory authority, lacks any evidentiary basis, and is unlawful," Revolution Wind said in its complaint against U.S. Interior Secretary Doug Burgum and five other federal defendants. The suit was filed in U.S. District Court for the District of Columbia.

U.S. President Donald Trump has repeatedly criticized wind energy as ugly, unreliable, and expensive, and his administration is leaning on multiple federal agencies to rein in wind development.

Critics say Trump's stance on offshore wind is at odds with his goal to boost energy supplies to power the nation's ambitions around artificial intelligence, which requires a huge amount of data processing.

The suit from Rhode Island and Connecticut was filed in federal court in Rhode Island late on Thursday. It asks the court to declare the stop-work order unlawful.

"This kind of erratic and reckless governing is blatantly illegal, and we're suing to stop it," Connecticut Attorney General William Tong said in a statement.

An Interior Department spokesperson said the agency would not comment on the litigation.

Revolution Wind, a 50/50 joint venture between wind developer Orsted and Skyborn Renewables, said it had already spent about $5 billion on the project, and that it will incur costs of another $1 billion if the order remains in place.

Orsted and Skyborn warned of potential delays, citing limited availability of specialized vessels required for offshore wind construction.

If the vessels depart due to the stoppage, the project would likely be delayed by at least a year, or even be at risk of cancellation, the filing said.

The Revolution Wind challenges came as a federal judge in Boston heard arguments in a lawsuit brought in May by 17 Democratic-led states and the District of Columbia seeking to prevent the Trump administration from suspending new wind energy leasing and permitting.

U.S. District Judge William Young stressed that it was not his role to second-guess the policy preferences of the president, who "seems to have tied our energy future to fossil fuels."

But he questioned whether the agencies that implemented Trump's directive did enough to explain why they adopted the pause, saying the "record here is pretty thin, and that's being pretty generous."

The Interior Department's Bureau of Ocean Energy Management also halted a neighboring project owned by Norwegian energy firm Equinor in April, although the order was later lifted after diplomatic efforts by Norway's government.

Revolution Wind was scheduled to be completed next year, and was expected to produce enough electricity to power 350,000 homes in Rhode Island and Connecticut.

The timing of the halt to Revolution Wind is particularly damaging for Orsted, which announced last month a plan to raise 60 billion Danish crowns ($9.41 billion) through a rights issue.

($1 = 6.3751 Danish crowns)

(Reporting by Jacob Gronholt-Pedersen in Copenhagen and Nichola Groom in Los Angeles, editing by Terje Solsvik; Additional reporting by Nate Raymond in Boston; Editing by Jan Harvey, Marguerita Choy and Himani Sarkar)