AINEWS
The Aug. 6 deal brings federal wind lease buyouts to $3.93B across 12 leases. RWE routes its share to a Louisiana LNG terminal and turbines for 15 gas peakers, plants that run only at demand spikes.
The U.S. government is paying German utility RWE $1.2 billion this week to walk away from three offshore wind leases off California, Louisiana, and New York, and RWE will route most of that money into a Louisiana liquefied natural gas export terminal and gas turbines for 15 new peaking power plants (RWE press release).
The Aug. 6 settlement with the Interior Department covers a 1.6-gigawatt floating lease off Humboldt County, California, originally bid at $157.7 million; a 1.24-gigawatt lease off Lake Charles, Louisiana, won for $5.6 million; and a roughly 3-gigawatt New York Bight lease originally auctioned for $1.1 billion, per industry coverage citing Heatmap News and the settlement filing. RWE had committed roughly $19.6 billion to its U.S. offshore wind program before walking away.
The redirected money is the part the wire coverage is missing. Of the $1.2 billion, $900 million will go toward a small equity stake in a Louisiana LNG (liquefied natural gas) export terminal. LNG is natural gas supercooled for transport by ship, a category the federal government has been broadly promoting for new export capacity. The remaining $300 million is earmarked for natural gas turbines to power 15 new "peaking" power plants, plants that run only at demand spikes. Per the Maritime Executive, the peakers are among the most expensive and most polluting gas plants to operate.
The peaker plan carries a timing gap the settlement does not close. RWE's release notes that the new gas turbines sit in a manufacturing backlog that stretches into the early 2030s. The wind capacity RWE is surrendering, by contrast, was already leased, sited, and in early engineering. The trade swaps gigawatts that were close to construction for gigawatts whose hardware is years from delivery. New peakers also displace nothing on the existing grid by definition; they are net additions that sit idle most of the time.
This is the fifth such settlement the Trump administration has struck with a wind developer in 2026. Together, the buyouts have paid out $3.93 billion to coax developers out of 12 offshore leases, according to TechCrunch's running tally. EDF Renewables and other developers are pursuing comparable exits, which would push the total higher and the canceled-gigawatt count further.
The sharpest comparison sits across the Atlantic. In the same window, RWE won 6.9 gigawatts of new U.K. offshore wind capacity in Britain's most recent leasing auction, per the same RWE release. The same utility, the same quarter, is pulling capital out of U.S. offshore wind and into U.K. offshore wind. The redirect is a U.S. policy choice, not a market verdict on whether offshore wind can clear a competitive auction.
Senator Sheldon Whitehouse (D-RI), speaking through the AP, called the structure a "bribery scheme" that swaps wind for fossil-fuel infrastructure, per WCAX's wire report. The administration frames the buyouts as restoring energy choice to states and developers.
The open question is whether the $300 million in turbine orders actually translates into 15 peakers, and on what timeline. RWE's settlement buys out wind that was on a near-term construction path; the gas replacement is gated by a backlog whose delivery dates the settlement does not commit to. EDF and other developers are still negotiating their own exits, and the $3.93 billion tally will keep climbing as those deals close.