While seven states are taking the Trump administration to federal court to challenge the legality of its deal with energy developer TotalEnergies to convert two US East Coast offshore wind site leases valued at $928 million to oil and gas projects in other states, new deals have been made.
The U.S. Department of the Interior said June 17 that it reached an agreement to pay developer Invenergy about $765 million to “voluntarily terminate” four ocean leases in New Jersey, Maine and central California that were acquired at auctions during the Biden administration. Invenergy will redirect the money “toward other domestic energy sources,” the agency said, including natural gas-fired power plants in Indiana, Wisconsin, Iowa, Kansas and Missouri and geothermal energy projects in western states. Invenergy hopes to begin exploratory drilling this year at geothermal sites in California, Idaho, Nevada and other states, according to the Los Angeles Times.
Invenergy and its partner energyRE intended to build the 2.4 GW Leading Light Wind project in its offshore lease area adjacent to New York and New Jersey, with a capacity originally intended to support both statistics. But it was canceled in November 2025 due to cost and supply chain challenges “that have made the development of new offshore wind projects extremely difficult,” according to a NJ state filing from the developers. Invenergy’s other lease areas, two in the Gulf of Maine and one in Morro Bay, California, had a potential 4.8 GW of electrical capacity.
The company will “deploy additional capital on projects that can be delivered in a commercially reasonable timeframe and meet customer demand while continuing to evaluate opportunities as market conditions evolve,” said Daniel Runyan, Invenergy’s senior vice president of development.
“Instead of supporting large-scale homegrown energy solutions that already provide savings for Northeast residents, these actions undermine local economies and threaten American jobs and energy affordability,” said the offshore wind advocacy group Oceantic Network. The cancellation of a 1 GW offshore wind project is estimated to permanently eliminate up to $9.5 billion in US economic output.
But Invenergy is still proceeding with building the Grain Belt Express, an estimated $11 billion high-voltage transmission line that will cross 800 miles across four Midwestern states to deliver solar and wind power to the eastern United States, despite the administration last year revoking a $4.9 billion conditional federal loan guarantee. Now, as a privately funded project, pre-construction and engineering is underway on the first phase of the project in Kansas and Missouri. The line will also be built in Indiana and Illinois. Quanta Services and Kiewit Energy Group are the main contractors for the first phase, with less than $1.7 billion in combined contracts awarded last year.
The Invenergy deal follows others
Invenergy’s wind purchase agreement follows those reached several weeks earlier with developers Bluepoint Wind and Golden State Wind to give up their offshore wind leases in New York-New Jersey and California, respectively, and redirect investment of about $885 million to “LNG projects, oil and gas assets and other energy infrastructure” in the Gulf Coast areas, Interior said. The funds include about $765 million for the Bluepoint Wind lease and $120 million for the Golden State lease established for Morro Bay. California, wind energy zone. Both developers then “decided not to pursue any new offshore wind development in the US,” Interior said.
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UPDATED: But in a June 23 announcement, California Attorney General Rob Bonta and California Energy Commission Chairman David Hochschild notified the U.S. Department of the Interior and developer Golden State Wind LLC of a lawsuit against them over an “illegal deal that puts at risk California’s clean energy gains, thousands of high-quality jobs and more than $100 million in industry-approved public investments offshore wind power”. They said that if the deal goes ahead, it “threatens to set back California’s growing offshore wind industry by years.” The company had planned a 2GW floating wind project and committed $30 million to workforce training, supply chain development and local investment.
Bonta and Hochschild also said an investigative subpoena was issued to Invenergy seeking a copy of its agreement with Interior for its California site, which they claim the agency has not released, and seeking more details about its “negotiation and impact.”
In its TotalEnergies deal, Interior said funding from canceled New York-Jersey and North Carolina offshore leases would be diverted to build new trains at the Rio Grande LNG terminal project in Texas, develop “upstream conventional oil” in the Gulf of Mexico and toward shale gas production. Interior Secretary Douglas Burgum said the deal was voluntary.
According to Interior, the settlement agreements. now estimated at $2.5 billion, would be paid out of the US Treasury Department’s taxpayer-funded judgment fund. But according to the June 2 lawsuit by the attorneys general of New York, New Jersey, Connecticut, Maine, Massachusetts, Rhode Island and Vermont, “no statute authorizes the federal defendants to use a sham settlement agreement to unlawfully terminate an offshore wind lease and redirect lease money to an independent, unauthorized use favored by the president.”
Sierra Club senior counsel Nancy Pyne called the deals “dark deals.”
Meanwhile, TotalEnergies may have a harder time trying to recoup recent investments in offshore wind power in Germany as it plans to pull out of a project due to what it said are delays in grid connections and lagging economic conditions, according to European press reports.
TotalEnergies said it is in talks with the German government related to an estimated $7 billion payment for several leases won in a 2023 auction, according to reports. The firm said it is “actively working on the realization of our projects” and is looking for “practical solutions”.
