The Trump administration announced two more payouts Monday for energy companies to walk away from U.S. offshore wind projects under development.
Bluepoint Wind and Golden State Wind have agreed to end their offshore wind leases in exchange for reimbursements totaling nearly $900 million. Both companies have decided not to pursue any new offshore wind projects in the United States, the Interior Department announced Monday.
Bluepoint Wind is an offshore wind project in the early stages of development off the coasts of New Jersey and New York, while Golden State Wind is a floating offshore wind project proposed off California’s central coast.
Interior said it’s following the model of its recent deal with the French energy company TotalEnergies, which is getting a $1 billion payout to walk away from projects off the coasts of North Carolina and New York. TotalEnergies agreed in March to what’s essentially a refund of its leases, and will invest the money in fossil fuel projects instead.
The deals come after the administration’s efforts to block offshore wind have been thwarted by the courts. A federal judge vacated Trump’s executive order blocking wind energy projects in December, declaring it unlawful as she sided with state attorneys general from 17 states and Washington, D.C., who challenged the order.
Two weeks later, the administration ordered that construction stop on five major East Coast offshore wind projects, citing national security concerns. Developers and states sued, and federal judges allowed all five to resume construction, essentially concluding that the government didn’t show that the national security risk was so imminent that construction must halt.
Environmental groups and Democrats have questioned the legality of the TotalEnergies deal and said it could be harmful to the U.S. economy and environment.
Both Bluepoint and Golden State are co-owned by Ocean Winds, a joint venture of EDP Renewables and global energy giant Engie. Bluepoint’s lease cost $765 million, while Golden State Wind will be eligible to recover approximately $120 million in lease fees, Interior said.
Interior Secretary Doug Burgum said companies were sold a product that was only viable when propped up by massive taxpayer subsidies when they bid for these offshore wind leases in 2022, under former President Joe Biden.
“Now that hardworking Americans are no longer footing the bill for expensive, unreliable, intermittent energy projects, companies are once again investing in affordable, reliable, secure energy infrastructure,” Burgum said in a statement. “We welcome each of the projects’ willingness to actually support baseload power and lower utility bills for American families.”
Bluepoint Wind and Golden State Wind were slated to be major offshore wind projects, each capable of powering more than 1 million homes when complete and helping the states of New Jersey, New York and California meet their clean energy goals.
Bluepoint Wind is a partnership between Ocean Winds and Global Infrastructure Partners. Global Infrastructure Partners, a part of investment giant BlackRock, has committed to invest up to $765 million into a U.S.-based liquefied natural gas facility. Interior said it would cancel the offshore wind lease and reimburse the company for the amount invested in the LNG project.
Golden State Wind is a joint venture by Ocean Winds and the Canada Pension Plan Investment Board. Under its agreement, Golden State Wind can recover about $120 million in lease fees after the same amount is invested in oil and gas assets, infrastructure or projects along the Gulf Coast, Interior said.
The companies said they appreciated the constructive engagement with the administration.
Michael Brown, CEO of Ocean Winds North America, said the deal provided “clarity” for the company and its investors. “Our priority remains disciplined capital allocation and delivering reliable energy solutions that create long-term value for ratepayers, partners and shareholders,” he said.
In his second term, Trump has gone all in on fossil fuels, which he says will lower costs for families, increase reliability and help the U.S. maintain global leadership in artificial intelligence.
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McDermott reported from Providence, R.I.
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