In March an extraordinary episode in the energy business slipped by largely unnoticed. This is hardly surprising. The world was focused on the ongoing US/Israeli war on Iran, started in February; on its implications for the global energy landscape; and for most of us, helpless to affect the outcome, on a selfish concern over the likely cost of gas and the cost of living generally. Yet, the recent deal made between the US government and Total Energies speaks not just to the weird, well-documented personal hangups of President Trump and the pro-fossil fuel direction of the country’s energy strategy, but to some current disenchantment with wind power investment extending beyond the US.
In a surprise move on 23 March, TotalEnergies announced the signing of settlement agreements with the US Department of the Interior (DOI) to relinquish its Carolina Long Bay and New York Bight offshore wind leases awarded in 2022. In doing so, the company ended its nascent involvement in wind power in the US.
In what must be a unique arrangement, in return for giving up its leases, Total Energies will be reimbursed for its investment of nearly $1 billion, with the funds being redirected to help finance the next decade Rio Grande LNG plant in South Texas. The company explained that its studies had shown that offshore wind developments in the US, unlike those in Europe, are costly and might have a negative impact on power affordability for US consumers. Since other technologies are available to meet the growing demand for electricity in the US in a more affordable way, TotalEnergies considered there was no need to allocate capital to this technology.
CEO Patrick Pouyanné said, ‘We will reinvest the refunded lease fees to finance the construction of the 29 Mt Rio Grande LNG plant and the development of our oil and gas activities … allows us to support the development of US gas production and export. These investments will contribute to supplying Europe with much-needed LNG from the US and provide gas for US data centre development. We believe this is a more efficient use of capital in the US.’ The company threw in to its announcement, news of a recent letter of intent with Glenfarne, lead developer of an Alaskan LNG export project, doubtless favourably viewed in the White House as part of the American ‘energy dominance’ strategy.
'No need to allocate capital to this technology'
Some cynics have wondered about the technicalities of the 'deal,' i.e., where exactly in the US Administration will the money come from? Most surprising, perhaps, is the abruptness of Total Energies’ withdrawal from the wind power market so soon after making the investment. Of the oil majors, it is the most aggressive in pursuing the renewable path.
In Europe particularly, where the regulatory framework is favourable, TotalEnergies has a substantial wind portfolio. It operates the Seagreen wind farm offshore Scotland, one of the world's largest, and is piloting floating wind technology near the North Sea Culzean platform. In Germany, it is partnering with RWE to develop two high-capacity offshore wind farms scheduled for 2031/2032. Also with RWE, it is working on the offshore OranjeWind project in the Netherlands, integrating wind power with green hydrogen production. In France, TotalEnergies is making its biggest investment in the country in 30 years, spending an estimated €4.5 billion on the 1.5 GW Centre Manche 2 project, offshore Normandy, due for completion in 2033. In addition, it is invested in pioneering the use of barge-float technology in the Mediterranean Eolmed project, led by the French renewable energy developer Qair.
More globally, as part of its multi-energy strategy, TotalEnergies in 2023 signed an investment agreement with the government of Kazakhstan for the giant Mirny onshore wind project in response to the dual challenge of reducing carbon emissions and electrifying isolated rural areas. The idea is to harness the winds that sweep across the region’s semi-arid expanses and transform them into low-carbon electricity to supply a reliable and sustainable power supply for one million people. In the Far East the company is engaged in further offshore wind projects in Yunlin (Taiwan) and Bada (South Korea).
TotalEnergies’ sudden re-evaluation of the economics of wind power offshore the US East Coast requires some further context. For a start, the two leases were acquired during the Biden Administration. But on day one in 2025, the incoming Trump Administration ordered a withdrawal of all federal waters from future offshore wind leasing; a blanket pause on all federal approvals for both onshore and offshore wind projects; and a review of all active leases. Simultaneously, the first orders to boost traditional oil and gas exploration and production were announced.
Then in December last year the Department of the Interior paused the leases for all large-scale offshore wind projects under construction due to national security risks identified by the Department of War.
This pause, allegedly to enable leaseholders and state partners to assess the possibility of mitigating the national security risks would impact the estimated $25 billion in investment in five wind farms: Vineyard Wind 1 off Massachusetts, Revolution Wind off Rhode Island, Sunrise Wind and Empire Wind off New York, and Coastal Virginia Offshore Wind off Virginia. Together, those projects had been expected to create 10,000 jobs and power more than 2.5 million homes and businesses. The official statement said unclassified reports from the US government had long found that the movement of massive turbine blades and the highly reflective towers create radar interference called ‘clutter’. An MIT Technology Review report does confirm that ‘There are real challenges that wind farms introduce for radar systems, which are used in everything from air traffic control to weather forecasting to national defense operations. A wind turbine’s spinning can create complex signatures on radar, resulting in so-called clutter.’ This of course begs the question of why this issue was not raised earlier.
At the time of writing, the operators of the five offshore wind projects have successfully sued the US government through the Federal Courts and had the stop orders rescinded, but major political uncertainty persists. All this is very ironic because the US is easily the second largest generator of wind power in the world, with a cumulative capacity of 161 GW, according to various sources, admittedly dwarfed by China’s 692 GW. Something like 10-11% of US electricity is generated from wind, virtually all from onshore sites.
It is not difficult to see why TotalEnergies took the exit door on offer. Yet its decision chimes with at least a marginal dip in enthusiasm for wind power worldwide. 2025 was actually record-breaking; 169 GW of wind power was added, a 38% increase over the previous year. According to a BloomberNEF analysis, this was largely driven by China, which alone installed 130 GW. But the analyst suggests a slowing in growth in 2026, mainly down to China, which agrees with the 6% decline predicted by Wood Mackenzie. Both estimates were offered before the turmoil in the energy market created by the Middle East War.
The wind energy market now looks bifurcated. In the short term, the spike in gas price for electricity generation benefits wind operators with uncontracted capacity, which can be sold at significantly higher margins. More fundamentally, all renewable energy options have received a boost from the planning perspective. The current crisis has provided another example of the dangers of exposure to geopolitical shocks when a country is dependent on oil, gas or LNG from specific suppliers, be they Russia, the US, or the Middle East nations. EU countries are working on a solution with its ‘sovereign energy’ strategy, in the case of wind power targeting 425 GW of wind capacity by 2030. In early 2026, wind and solar combined for the first time to produce more electricity than fossil fuels in the EU. Germany, with 77.7 GW at the end of 2025, has the largest installed capacity, while Denmark now generates 50% of its daily power needs from wind.
Not everything is blowing in the right direction. The very factors that give existing wind power a cost advantage will rebound and impact future investment confidence. A year or so ago, the World Economic Forum, among others, was already warning that accelerating adoption of wind energy, especially offshore, was being endangered by soaring costs, project supply chain problems, and increasing raw material and labour costs. In the wind power sector globally, other obstacles often cited are slow or tortuous permitting procedures, the need to replace existing ageing turbine units, and the difficulty encountered with integration into electricity grids lacking the capacity to absorb the challenge of intermittent supply.
Wind power is also competing with solar energy for investment dollars, a competition that solar will continue to lead. Solar power is outperforming wind globally by nearly every growth metric, primarily because it is easier to build, cheaper to manufacture, and more versatile for different users. That is the verdict of the International Energy Agency and other sources. In terms of capacity additions in 2025, the world added nearly 4 GW of solar for every 1 GW of wind. Solar installations reached nearly 600 GW in 2024 (a 33% increase), while wind additions, though record-breaking, were significantly lower in volume. Solar is ‘winning’ because it is highly modular and can be installed on a single residential roof or a massive desert tract. Huge Chinese-manufactured solar panel over-capacity has pushed component prices to historic lows, making solar the cheapest form of electricity in most of the world. Wind scores on higher capacity factor, 20-50%, compared with 15-20% for solar, and of course can operate at night.
But no prizes for guessing the real winner in all this: oil and gas companies, thanks to windfall unearned profits.
'No prizes for the real winner'
Views expressed in Crosstalk are solely those of the author, who can be contacted at andrew@andrewmcbarnet.com.
