On Thursday, renewable energy company RWE announced that it entered into a $1.22 billion agreement with the Trump administration to relinquish its offshore wind leases. RWE is one of two companies, alongside Vineyard Offshore, that hold wind leases off California’s North Coast through its RWE U.S. Offshore subsidiary.
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According to a press release published by RWE Thursday morning, the company’s settlement with the U.S. Department of Interior will “resolve claims against the U.S. government and relinquish its offshore wind leases off the coasts of New York, California and Louisiana.”
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“RWE U.S. Offshore secured these leases from the U.S. government with a long-term commitment to develop offshore wind capacity in American waters and invested more than $1 billion toward the leases and the development of these projects,” RWE’s release reads. “These leases provided legal rights to develop offshore projects and represented years of planning, investment, and partnership with federal agencies.
“After careful consideration, it was determined there is no path forward to permit these projects in the U.S. for the foreseeable future. The settlement resolves RWE U.S. Offshore’s legal claims and provides $1.22 billion in settlement funds. The company determined that this resolution best serves the interests of its stakeholders and allows it to direct resources toward energy projects that can be advanced with certainty.”
The news did not come as a shock.
“Today’s news is disappointing but not surprising,” Environmental Protection Information Center Executive Director Tom Wheeler told the Times-Standard via an emailed statement Thursday morning. “The Trump Administration has used its full weight to hamper offshore wind development. Elsewhere, other offshore wind companies have already caved to the pressure. The winners today are the fossil fuel industry and the losers are Humboldt County and the planet. But tomorrow is a new day. The Trump Administration will end. And the promise of offshore wind remains: clean, reliable energy built locally by well-paying blue-collar jobs. The Trump Administration can delay, but it cannot suppress the future.”
RWE’s press release says that the agreement will allow the company to “redeploy its capital to accelerate value-accretive opportunities that deliver reliable and affordable energy.” That “redeployment” is described as including “$900 million to acquire an indirect 16% stake in the Louisiana LNG Project” — a large-scale natural gas development that has been criticized as a major source of greenhouse gas pollution — and other natural gas projects throughout the U.S.
“While RWE’s shareholders get their bag, the rest of us get the finger. We the people are paying for this buyout, and what we get in return is more expensive energy, backwards climate policy and greater harm to our communities,” Assemblymember Chris Rogers told the Times-Standard via email Thursday morning. “The Trump Administration is again using taxpayer dollars to settle personal vendettas and line the pockets of his friends and donors by protecting oil profiteers from the competition of clean, affordable and renewable energy.
‘Every American should be enraged.’
U.S. Rep. Jared Huffman (D-San Rafael), ranking Democratic member of the U.S. House of Representatives’ Committee on Natural Resources, released a statement Thursday morning just before noon, calling the DOI and RWE’s agreement a “fake settlement” and saying that “the deals are deeply corrupt and illegal” and “when the accountability comes, and I promise you accountability is coming, everyone involved in them will answer for it.”
“The most corrupt, lawless administration in American history is once again flouting the law and attempting to use over $1 billion in taxpayer dollars to kill off clean energy projects slated to create thousands of good jobs and lower electricity bills for Californians,” Huffman said. “Trump is strongarming companies into taking these illegal deals and abandoning offshore wind projects that would put huge amounts of cheap electricity on the grid and lower electricity prices. Instead, he is pressuring them to invest not only in dirty fossil fuel projects, but in LNG export facilities that push domestic energy prices even higher at a time when American families are reeling from skyrocketing costs caused by his reckless war of choice in Iran.
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“One of the projects illegally canceled in this fake settlement is off the coast of Humboldt County in my district. The benefits of that project were tremendous — revitalizing the economy of a rural community, creating thousands of quality jobs and lowering utility bills for families all across California. Like a mob boss, Trump tightened the screws on RWE and, shamefully, the company capitulated and went along with this sham deal that robs the American people and makes a mockery of RWE’s stated commitments to clean energy. When these illegal, fake settlements are reversed by the courts and/or future congressional action — and they will be — RWE and others who participate in these charades will own every bit of the shame they deserve.”
Huffman said that the total cost to the taxpayers for paying companies to abandon offshore leases already ads up to “the tune of about $4 billion” noting that such settlements have thus far employed funding intended for the payout of federal lawsuits and settlements.
“Trump is using the Judgment Fund as a slush fund to pay for it. This is the same pot of taxpayer money Acting Attorney General Todd Blanche tried to use for his so-called ‘Anti-Weaponization Fund’ to pay off convicted J6 felons,” Huffman said. “Once again, we see this administration’s priorities laid bare: treating a fund that exists to resolve valid claims and liabilities as a massive personal slush fund Trump can use to reward criminals, kill off clean energy projects and do virtually anything else that serves his personal and political interests.”
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Spokesperson Anthony Martinez from Gov. Gavin Newsom’s office provided the Times-Standard with the following statement: “The pattern is impossible to ignore. After getting beaten in court again and again, Trump has stopped trying to win on the merits and continues to make backroom deals to kill clean energy projects — a gift to his fossil fuel industry donors at the expense of America’s economic security.
“While China and other global competitors race to dominate the technologies that will power the future, California is building a modern grid, energy independence and an energy future that Trump is too small to understand.”
“This action by the Trump Administration is utter BS,” Sen. Mike McGuire (D-Healdsburg) said in an emailed statement delivered around 1 p.m. “The overall California RWE wind project would have advanced clean, reliable wind energy — enough to power 5 million homes — and created good rural jobs for the North Coast. Seemingly ripped from a script of VEEP, Trump is now forcing RWE’s hand to reinvest in the same fossil fuels which delivered the climate crisis to our door. This is yet another example of how off the rails the Trump Administration has gone. Total buffoonery.”
The Interior Department provided a statement from Secretary of the Interior and Chairman of the National Energy Dominance Council Doug Burgum on Thursday afternoon.
“Americans deserve an energy system built on common sense, not one dependent on costly subsidies or technologies that can’t meet our country’s current demand,” said Burgum. “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.”
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Robert Schaulis can be reached at 707-441-0585.
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