California Files Lawsuit Against Trump Administration, Golden State Wind Developer Over Cancelled Lease

California Attorney General Rob Bonta and the California Energy Commission (CEC) are suing the Trump administration and Golden State Wind LLC over what the plaintiffs say was an unlawful buyout of Golden State Wind’s offshore wind energy lease.

The lawsuit, filed on 28 August, is challenging a part of the deal worth a total of USD 885 million (around EUR 756 million) that the US Department of the Interior (DOI) reached in April with Bluepoint Wind and Golden State Wind developers, under which the developers would voluntarily terminate their offshore wind leases in exchange for a refund of what they paid in lease fees.

The Golden State Wind project, a 2 GW floating wind farm proposed to be built in the Morro Bay Wind Energy Area (WEA) off California’s central coast, is a joint venture of Ocean Winds and Reventus Power, with the project managed and led by Ocean Winds.

Under the agreement with the federal government, Golden State Wind LLC would terminate its lease for the floating wind project, for which it would be eligible to recover approximately USD 120 million (around EUR 103 million) in lease fees after making an equivalent investment in US oil and gas assets, energy infrastructure, and/or LNG projects along the Gulf Coast.

California argues that the agreement violates several federal laws, including the Outer Continental Shelf Lands Act, which the State says limits the DOI’s authority to cancel offshore wind leases.

The lawsuit also challenges DOI’s characterisation of the agreement as a settlement. According to California, the deal “purportedly ‘settles’ litigation that Golden State Wind never brought, challenging action that DOI never took.” The State says that the USD 120 million payment from the federal Judgment Fund was therefore not a settlement of an existing lawsuit, but part of an arrangement to facilitate the cancellation of the lease.

California is asking the court to strike down the agreement and prevent the Trump administration from implementing it.

The State says the lease cancellation also puts its offshore wind investments, clean energy and climate goals, and broader energy economy at risk. California says it has invested more than USD 100 million (around EUR 86 million) in preparing ports, transmission systems and industries for offshore wind since federal planning for the industry began off the state’s coast about a decade ago. The lawsuit says the cancellation of offshore wind projects could put those investments at risk, along with union jobs, infrastructure investment and long-term economic development.

Under California’s offshore wind strategic plan, the state aims to develop 25 GW of offshore wind capacity by 2045, which would be enough to power roughly 25 million homes and provide about 13 per cent of California’s electricity supply. The industry is also expected to support local manufacturing and economic development, particularly around the ports of Long Beach and Humboldt, where offshore wind turbines were expected to be staged and assembled.

California estimates that cancelled offshore wind projects could put more than 174,750 jobs, as well as related infrastructure investment and long-term economic development, at risk.

The lawsuit follows a CEC administrative investigative subpoena served on Golden State Wind in May seeking documents and information related to the buyout. In June, the California Department of Justice and CEC sent a Notice of Intent to Sue concerning the agreement between the DOI and Golden State Wind.

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