Aggressive local content requirements, meant to build a domestic supply chain, backfired by making components two to three times more expensive due to a lack of scale. This destroyed project profitability, causing international developers to pull out of Taiwan's offshore wind market.

The CEO of Ørsted candidly reflects that their US project write-downs stemmed from a strategic error: prioritizing volume growth over value. They failed to step back from projects quickly enough when market conditions and risks became apparent.

Ørsted received a "stop work order" for a US offshore wind project that was 80% complete. This highlights the severe, late-stage political and regulatory risks in long-term infrastructure projects, even in developed markets, which turned a massive asset into a liability overnight.

Charts showing plummeting solar and wind production costs are misleading. These technologies often remain uncompetitive without significant government subsidies. Furthermore, the high cost of grid connection and ensuring system reliability means their true all-in expense is far greater than component costs suggest.

As a leader in offshore wind, Ørsted strategically pivoted *away* from floating wind. The CEO states that while the technology will mature, its levelized cost of electricity is currently too high to be competitive against bottom-fixed wind, onshore wind, and solar in most markets.

The restructuring of the U.S. electricity sector wasn't purely ideological. It was a direct response to regulated utilities making massive, incorrect bets on demand growth, building unneeded power plants, and causing prices to skyrocket for captive customers. Competition was introduced to shift this investment risk from consumers to private investors.

To minimize risk, government contracts often require bidders to have prior experience building the exact same system. This seemingly prudent rule creates a catch-22, barring new entrants and locking in a small number of incumbents who can then dominate the market and inflate prices.

China's economic structure, which funnels state-backed capital into sectors like EVs, inherently creates overinvestment and excess capacity. This distorted cost of capital leads to hyper-competitive industries, making it difficult for even successful companies to generate predictable, growing returns for shareholders.

The concept of the 'Winner's Curse'—where the winner in an auction often overpays—originated in industry, not academia. Engineers at Atlantic Richfield (ARCO) discovered that the oil leases they successfully bid on consistently underperformed expectations, realizing the winning bid is by nature the most optimistic and therefore often inaccurate.