DistantNews
Support us
🇬🇧 United Kingdom /Energy & Infrastructure

Trump administration to pay German firm $1.22bn to cut offshore wind leases

From The Guardian · () English

Summarized and contextualized by DistantNews.

At a glance

News Named sources New plan
  • The U.S. government under the Trump administration agreed to pay German firm RWE $1.22 billion to cancel offshore wind leases.
  • The deal redirects RWE's investment from renewable energy to fossil fuels, including a stake in a liquefied natural gas project and natural gas plants.
  • Critics argue this is the largest of several deals totaling nearly $4 billion in taxpayer money spent to abandon clean energy projects, potentially increasing energy costs.

The Trump administration has finalized a $1.22 billion deal with German energy company RWE, securing the cancellation of its offshore wind leases in New York, California, and Louisiana. This agreement redirects RWE's significant investments away from renewable energy and towards fossil fuel projects, marking the fifth such deal struck by the administration.

After careful consideration, it was determined there is no path forward to permit these projects in the US for the foreseeable future.

— RWEThe company's explanation for abandoning its offshore wind leases.

In exchange for relinquishing its leases, RWE will receive $1.22 billion. The company plans to use $900 million to acquire a 16% stake in an unnamed liquefied natural gas (LNG) project in Louisiana, funding its construction. An additional $300 million will be allocated to a turbine reservation agreement for developing 15 natural gas peaker plants nationwide.

The settlement resolves RWE US Offshore’s legal claims and provides $1.22 billion in settlement funds.

— RWEDetails on the financial terms of the agreement.

Interior Secretary Doug Burgum praised the agreement, stating it would "strengthen our nation's energy security, provide dependable baseload power, and help keep electricity affordable." However, critics contend that these deals, which have now cost nearly $4 billion in taxpayer funds, are effectively killing clean energy projects. This latest settlement with RWE is reportedly the largest of its kind under the Trump administration.

We welcome RWE’s agreement and voluntary investment in projects that strengthen our nation’s energy security, provide dependable baseload power, and help keep electricity affordable for hardworking Americans today while supporting our country’s long-term energy future.

— Doug BurgumThe Interior Secretary's positive assessment of the deal.

Previous agreements, including a $928 million deal with TotalEnergies to cancel an offshore wind lease, have faced legal challenges. New York's Attorney General Letitia James described such deals as "sham" and "illegal." Critics argue these actions benefit fossil fuel companies while potentially raising energy bills for Americans, especially amid rising global fuel prices.

sham deal

— Letitia JamesNew York's Attorney General's description of a similar deal with TotalEnergies.
DistantNews Editorial

Originally published by The Guardian. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog