President Donald Trump‘s administration has reached agreements to end two additional offshore wind lease arrangements in exchange for $885 million in pledged investments in domestic fossil fuels.
The deals represent a new strategy in Trump’s effort to stymie U.S. offshore wind projects, which the president has called ugly, costly and inefficien
Agreements linked to federal offshore leasing
“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,” Interior Secretary Doug Burgum said in a statement.
An offshore wind industry group criticized the deals for canceling projects that would provide needed electricity to serve soaring demand.”We should maximize use of this valuable, domestic resource and pursue a true all-of-the-above energy strategy rather than deliberately limiting our options,” Hillary Bright, executive director of trade group Turn Forward, said in a statement.
Industry implications
Both projects are joint ventures. Ocean Winds partnered with a unit of asset manager BlackRock on Bluepoint Wind, which is off the coast of New York and New Jersey, and with Reventus Power, a London-based offshore wind investment firm, in the Golden State Wind project off California.
Global Infrastructure Partners, the BlackRock unit, agreed to invest $765 million, the bid amount for Bluepoint Wind, in a U.S. liquefied natural gas facility, the agency said.
“We look forward to continuing to deploy capital into conventional and other energy sources in furtherance of the twin goals of increasing U.S. energy independence and affordable energy,” Salim Samaha, chair of midstream and LNG for Global Infrastructure Partners, said in the statement. In addition, Interior said Golden State Wind will be able to recover $120 million in lease fees after it invests a similar amount in oil and gas, energy infrastructure or LNG projects.
What comes next
Engie said last week that it was in talks with the administration about a possible refund for its offshore wind leases.
It had paused three projects in development and booked impairments.”We welcome the opportunity to engage constructively with the administration on this agreement and acknowledge the clarity they have provided with this decision and deal,” Michael Brown, CEO of Ocean Winds North America, said.