RWE exits US offshore wind in $1.22 billion Trump administration settlement, redirects funds to gas
German energy giant RWE agreed to surrender all three of its US offshore wind leases for a $1.22 billion Interior Department settlement, redirecting the funds into LNG and natural gas plants as the Trump administration's campaign against offshore wind continues.
Deal structure
RWE, one of the world's top offshore wind developers, announced on August 6 a $1.22 billion settlement with the US Interior Department to surrender three offshore wind leases in federal waters off New York, California, and Louisiana. The agreement is the fifth the Trump administration has struck with energy companies this year to cancel offshore wind projects. Previous agreements with TotalEnergies, Ocean Winds, Invenergy, and Duke Energy totaled approximately $2.7 billion and resulted in the cancellation of nine federal leases. Including the RWE deal, total taxpayer spending on buyouts now approaches $4 billion.
RWE had acquired the leases under the Biden administration, paying $1.1 billion for the New York lease at a 2022 auction and a combined $163 million for the Louisiana and California leases. The projects were in early development stages and would not have come online until the 2030s. The company had already stopped work on its US projects in 2025 due to administration efforts to halt the offshore wind industry, which included several orders to freeze multibillion-dollar projects under construction.
- RWE acquires New York offshore wind lease for $1.1B at Biden administration auction
- RWE stops work on its US offshore wind projects due to administration efforts
- 50 US environmental groups write to administration over offshore wind buyouts
- RWE announces $1.22B settlement with Interior Department, fifth deal this year
RWE's rationale
RWE said it concluded that permitting the projects was no longer feasible under the current administration, which has halted all federal permitting for offshore wind.
After careful consideration, it was determined there is no path forward to permit these projects in the U.S. for the foreseeable future.
The company added that the resolution "best serves the interests of its stakeholders and allows it to direct resources toward energy projects that can be advanced with certainty." The settlement also resolves RWE US Offshore's legal claims related to the leases.
Investment redirection
Under the agreement, RWE will redirect the settlement funds toward fossil fuel projects. The company will spend $900 million to acquire a 16% stake in a Louisiana LNG project, with the settlement proceeds used to fund construction of the terminal. RWE did not disclose the LNG project owner, though Australia's Woodside Energy Group is developing a Louisiana LNG terminal. RWE also signed a $300 million turbine reservation agreement to develop a pipeline of 15 natural gas peaker plants across the United States.
- Louisiana LNG stake (16%)
- 900 $ millions
- Gas turbine order (15 peaker plants)
- 300 $ millions
Interior Secretary Doug Burgum welcomed the deal, saying the administration welcomed RWE's 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."
Broader US strategy and RWE's global position
The deal fits the Trump administration's wide-ranging effort to stop US offshore wind development, which President Trump regards as costly and ugly. A group of 50 US environmental groups wrote to the administration in May expressing concern over the buyout strategy.
Despite the US withdrawal, RWE maintains its international offshore wind business with 18 parks in service and four under construction. More broadly, the company plans to invest approximately €17 billion in the United States over the next six years, increasing its electricity production capacity from 13 GW currently to 22 GW by 2031.
