Trump’s Pause of Offshore Wind Development and Other Anti-Wind Actions: Is This Warranted? Is It Different from Biden’s LNG Pause? What About Damage to Whales?

     Biden had a goal of 30GW of U.S. offshore wind capacity by 2030. The rising cost of borrowing and inflation caused many of these heavily subsidized projects to balloon in costs, which caused some developers to pull out and others to renegotiate terms originally agreed upon before inflation hit hard. The lack of a domestic supply chain for offshore wind components and ships to deliver them also led to higher costs for these initial projects. Thus, from a financial perspective, the costs for what is essentially a new industry in the U.S. are very high, as would be expected.

     In February 2025, New Jersey Democrat governor Phil Murphy stopped approving offshore wind projects, citing high costs and political resistance. Dominion’s wind project offshore Virginia, which has bipartisan support and was expected to be completed in 2026, is also in limbo. Also in February, a group of conservative lobbyists including the Heartland Institute and the Committee for a Constructive Tomorrow (CFACT) lobbied Interior Secretary Doug Burgum to have NOAA revoke the permits for 11 offshore wind projects, citing dangers to whales and mammal protection laws including the Endangered Species Act, an odd turn perhaps for conservative orgs.

     Trump’s executive order calls for the temporary withdrawal of new areas for offshore wind leasing and a halt on new project approvals pending a review of leasing and permitting practices. Anti-wind activists cited “unprecedented spikes in whale deaths” that coincide with vessel surveys for the Atlantic Shores project. According to CFACT president Craig Rucker:

“There’s no way an environmental group should be in favor of offshore wind,” Rucker said. “They are always opposed to offshore oil drilling which involves only speculative harm. But here we actually see dead whales washing up on beaches in Virginia and other places along the East Coast and this is happening in increased numbers. But all we hear from the environmental groups is crickets.”

In particular, the endangered North Atlantic right whale population is at risk, where only 350 remain and only 70 are females capable of continuing the species. Since whales migrate up and down the Atlantic Coast, the whole Atlantic offshore wind area is an area of concern.

     In mid-March, the EPA revoked the Clean Air Act permit for the 1.5 GW Atlantic Shores wind project, citing Trump’s January 20 executive order, which mandated a pause on offshore wind leasing and a review of existing leases. The project developers put out a press release that states:

“Atlantic Shores stands ready to deliver on the promise of American energy dominance and has devoted extensive time and resources to follow a complex, multi-year permitting process, resulting in final project approvals that conform with the law.”

Shell and EDF, both part of the Atlantic Shores project, had already booked impairments of about $1 billion each on the project due to cost overruns associated with inflation and the higher cost of borrowing.

     Trump has long opposed wind energy, particularly offshore wind. He noted that it is “an economic and environmental disaster,” and remarked that it “looks horrible in the oceans.” He is correct that there are serious issues with offshore wind, including environmental and species impacts, high costs, intermittency, a possible threat to military operations and commercial navigation, and the issue with wind components making us more dependent on China. Trump administration people have argued that the Biden administration basically ignored evidence that the endangered North Atlantic Right whale was being severely impacted by offshore wind development, in pursuit of climate goals.

     The vast majority of Atlantic offshore wind leases are in federal waters. The pause of offshore wind development, enacted through the January 20 executive order, will last six months, so until July 20. Rising materials costs due to tariffs are expected to prevent any new projects from going forward. Projects well underway may be protected from tariffs by long-term contracts.

     Equinor ceased construction on April 17 of their Empire Wind project offshore New York, after the Trump administration ordered it to be halted pending further review. They expect to file a lawsuit since the project is well into the construction phase.

“Empire is engaging with relevant authorities to clarify this matter and is considering its legal remedies, including appealing the order,” Equinor said in a statement, adding the project “has validly secured all necessary federal and state permits and is currently under construction.”

The project, which finalized leasing in March 2017, was expected to be completed in 2027 and to provide power to New York City. Equinor’s CFO said at the end of April that the stoppage was unlawful:

“Our position is clear. The stop work order is unlawful,” he said. Equinor had received all necessary permits by last year, and had already done construction work on a port and laid rock on the seabed at the site of turbines. It says the project is more than 30% complete.

“Equinor has invested in good faith, and this is now a question about the sanctity of contracts,” Reitan said. The company is considering legal options.

Equinor has already invested $2.5 billion in the project.

     Trump’s NOAA complained that the project was improperly approved:

“Critical areas that support commercial and recreational fisheries were not excluded from leasing, and proposals that emphasized maximum development scenarios further restricted opportunities to reduce impacts on fisheries and important habitats."

Thus, it appears that the Trump administration is acting just like environmentalists act against fossil fuel projects, going for maximum delay to cause problems for developers.

     Stop work orders were also issued for ongoing wind projects offshore Maine, partially funded through a $12.6 million grant awarded by the DOE’s Advanced Research Projects Agency–Energy (ARPA-E). The three projects suspended include one that is more of a research project into floating wind turbines in deeper waters. Costs for such projects are higher, but wind speeds are higher further offshore. The stoppage announced in April is expected to last 90 days.

     German renewables developer RWE halted its U.S. offshore wind projects, citing political headwinds in April. Their CEO noted that future projects will only be pursued if certain conditions are met:

“All necessary federal permits must be in place. Tax credits must be safe harbored and all relevant tariff risks mitigated. In addition, onshore wind and solar projects must have secured offtake at the time of the investment decision. Only if these conditions are met will further investments be possible, given the political environment.”

     Companies, many from Europe, where offshore wind is a much more mature industry, have already sunk tens of billions into U.S. offshore wind leases and project development, and are being impacted by these political decisions.

     On May 5, eighteen Democratic attorneys general filed a lawsuit challenging Trump’s executive order restricting wind projects. New York Attorney General Letitia James noted:

“This arbitrary and unnecessary directive threatens the loss of thousands of good-paying jobs and billions in investments, and it is delaying our transition away from the fossil fuels that harm our health and our planet.”

     A letter to the Bureau of Safety and Environmental Enforcement (BSEE) from the Wampanoag Tribe of Gay Head (Aquinnah) last year claimed wind farm development had led to “potential negative and adverse impact[s]” on the environment, marine life, and human health.

     In April, the Government Accountability Office released a report echoing those concerns, noting wind projects had also affected the military’s defense and radar systems, and criticizing the BSEE for how it addressed problems.

     Biden’s LNG pause was based on activist-biased science regarding upstream methane leakage and was not a serious issue. The Trump offshore wind pause does seek to address some serious concerns about the environment, species impacts, impacts on commercial fishing, and potential impacts to military radar disruption. However, many of those potential impacts were presumably addressed through the original permitting process. There are important economic concerns as well. In Trump’s case, the pause seems to be more about revenge against wind development and his personal dislike for it. My guess is that some projects will go forward and others will not, so my expectation is for 10GW or less of offshore wind to be built by 2030, about a third of Biden’s original goal.  

     Just like the Trump delay is similar to environmentalist delays, the big impairment charges are somewhat analogous to the impairments taken by pipeline developers after environmentalist lawsuits made costs balloon, albeit in this case, the cost increases are due to market forces (inflation and high interest rates). A more straightforward analogy is the way both the wind stoppage and pipelines that have been abandoned due to opposition damage the economy by sunken costs that may not be recoverable. Both can become stranded assets. This can happen with renewables when subsidies are not adequate to allow developers to make enough profit to survive. 

     

References:

 

Inside Trump’s Plan To End Offshore Wind Projects. Grace Hall. Miami Herald. February 16, 2025. Inside Trump’s Plan To End Offshore Wind Projects

EPA yanks air quality permit for 1.5-GW Atlantic Shores offshore wind project. Diane DiGangi. Utility Dive. March 18, 2025. EPA yanks air quality permit for 1.5-GW Atlantic Shores offshore wind project | Utility Dive

Offshore Wind On Its Last Legs: Save the Whales Campaigns, Team Trump Boost Anti-Wind Legal Action. Marc Morano. February 22, 2025. Climate Depot, A CFACT Project. Offshore Wind On Its Last Legs: Save the Whales Campaigns, Team Trump Boost Anti-Wind Legal Action – Climate Depot

Anti-Wind Activists Have a Big Ask for the Big Man. Jael Holzman. February 13, 2025. Heat Map. Anti-Wind Activists Have a Big Ask for the Big Man - Heatmap News

It's Time for Burgum to Stop Defying President Trump’s Demand. H. Sterling Burnett. Western Journal. April 13, 2025. It's Time for Burgum to Stop Defying President Trump’s Demand

Trump’s offshore wind policies limit industry’s near-term growth: Morningstar DBRS vice president. Diana DiGangi. Utility Dive. April 10, 2025. Trump’s offshore wind policies limit industry’s near-term growth: Morningstar DBRS vice president | Utility Dive

As Trump escalates his war against wind energy, a giant 54-turbine project off the coast of New York ceases construction. Jordan Blum. Fortune. April 17, 2025. As Trump escalates his war against wind energy, a giant 54-turbine project off the coast of New York ceases construction

Trump administration orders construction halted on major NY offshore wind project. AP. Syracuse.com. April 16, 2025. Trump administration orders construction halted on major NY offshore wind project - syracuse.com

Energy Department targets Maine’s offshore wind as governor fights Trump on transgender athletes. Elaine Mallon, Washington Examiner. April 22, 2025. Energy Department targets Maine’s offshore wind as governor fights Trump on transgender athletes

RWE CEO says US offshore wind ‘stopped’, spells out new terms for new renewable investments. Recharge. April 25, 2025. RWE CEO says US offshore wind 'stopped', spells out terms for new renewable investments | Recharge

Global energy giant RWE halts US offshore wind because of Trump. Michelle Lewis. Electrek. April 25, 2025. Global energy giant RWE halts US offshore wind because of Trump | Electrek

Trump Administration Halt to Offshore Wind Project Was ‘Unlawful’, Company Says. Avi Salzman. Barron’s. April 30, 2025. Trump Administration Halt to Offshore Wind Project Was ‘Unlawful’, Company Says

Permit Collapse: Wind Farm Suffers Blow Under Trump. Grace Hall. Miami Herald. April 30, 2025. Permit Collapse: Wind Farm Suffers Blow Under Trump

Democratic states sue White House over halting wind energy projects: ‘Reckless’. Emily Hallas, Washington Examiner. May 6, 2025. ​​Democratic states sue White House over halting wind energy projects: ‘Reckless’