UTILITIES

The payout the Trump administration has given TotalEnergies to cease its new wind energy plans in the US

Will this set a precedent for the US energy sector? The TotalEnergies settlement may be just the beginning. The leases for undeveloped offshore wind projects across the Atlantic, Pacific and Gulf coasts carry a combined value of more than US $ 5bn – and some companies have already signalled they expect to be made whole.

RWE, the German renewables giant that paid more than US $ 1.2bn for three leases off New York, California and the Gulf of Mexico, has been forthright about its expectations.

“ If we never get the right to build the plants, I assume we’ ll get the money we’ ve already paid back. And if necessary, through legal action,” RWE CEO Markus Krebber said at a recent press conference in the spring.

The Interior Department did not respond to requests for comment on whether further negotiations are under way. What is clear is that the administration has found a mechanism that, unlike its earlier attempts, may prove far harder to challenge in court – and far more expensive for the American taxpayer.

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