TotalEnergies has agreed to relinquish its leases for two proposed offshore wind projects off the eastern coast of the US.

The company signed a settlement agreement with the United States Department of the Interior (DOI) to relinquish its Carolina Long Bay lease (Lease OCS-A 0545) and its New York Bight lease (Lease OCS-A 0538). Both had originally been awarded to the French company back in 2022. By relinquishing the leases, TotalEnergies has now completely exited the US offshore wind sector, which has been struggling amid heavy federal government headwinds.

The company had planned to develop, in partnership with several other big players in the sector, the 3GW New York Bight project and 1GW Carolina Long Bay project off the coasts of Long Island and North Carolina, respectively. However, it now joins Shell and RWE in completely exiting the US market.

Under the terms of the settlement, TotalEnergies will recover the lease fees paid and has committed to invest an equal amount in the development of US natural gas power production and exports, signaling the continued move towards natural gas by utilities and data center operators alike.

“TotalEnergies is pleased to sign these settlement agreements with the DOI and to support the Administration’s Energy Policy. Considering that the development of offshore wind projects is not in the country’s interest, we have decided to renounce offshore wind development in the United States, in exchange for the reimbursement of the lease fees,” said Patrick Pouyanné, CEO of TotalEnergies.

“Furthermore, these agreements, under which 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.”

Outside the US, data center companies have signed numerous offtake agreements for power from offshore wind farms. However, the US has seen zero, with only two offshore wind farms currently operational. The potential for growth has been further compounded by the current US administration, which, in December of last year, issued a stop-work order directing all major US offshore wind projects under construction to pause while federal agencies review alleged national security risks.

In response, Dominion Energy, which is developing the 2.6GW Coastal Virginia Offshore Wind (CVOW) project, off the coast of Virginia Beach, lodged a lawsuit against federal authorities, claiming the stop work order would “threaten grid reliability.”

Dominion has said that it requires approximately 27GW of new generation to meet electricity demand, which is forecast to grow 5.5 percent year on year and double by 2039. Much of this demand is tied to the state’s data center sector. As of late 2025, the utility reported that it had around 47GW of data center capacity in its pipeline across varied stages of contracting.

Ultimately, it seems the Trump administration’s sustained assault against the offshore wind sector is paying dividends. The sector’s nadir was marked last July, when the US Senate passed President Trump’s “Big Beautiful Bill,” which imposed a 50 percent tax on wind projects and a 30 percent tax on solar projects completed after December 2027, if they cannot prove they haven’t used Chinese components.

According to the Rhodium Group, the excise tax on wind and solar would increase their cost by 10-20 percent on top of losing the tax credits, with the additional costs likely passed onto consumers. This could lead to up to 4,500 clean energy projects not going ahead, potentially adding billions of dollars to annual energy costs.