On March 23, the Department of the Interior (DOI) announced that it finalized an unprecedented agreement to pay TotalEnergies, a French energy company, nearly $1 billion in taxpayer dollars to terminate two federal offshore wind leases. The amount is roughly equal to what the company paid to secure and maintain the federal leases in 2022. In exchange for the taxpayer-funded buyback, TotalEnergies agreed to invest $1 billion in an LNG facility unrelated to the original project.

But, strings attached or not, the deal will cost taxpayers a billion dollars from revenue TotalEnergies has already paid for a domestic energy project that has already submitted construction plans. Although Outer Continental Shelf (OCS) leasing has historically been concentrated on oil and gas, offshore wind is becoming a lucrative revenue stream for the American taxpayers. The TotalEnergies leases were acquired during the historic offshore wind lease sales in 2022, which yielded highly competitive results.

Terminating these leases not only runs counter to an energy dominance agenda, but it also undermines the overall strategy many energy companies have adopted to diversify their energy portfolios, especially as wind and solar costs have gone down significantly over the past few decades. According to the Energy Information Administration, renewable sources like wind and solar make up around 20% of total U.S. electricity generation, and wind power alone accounted for more than 10.4% of U.S. electricity generation in 2025, producing more than 464 terawatt-hours of electricity and regularly surpassing coal generation.

These two leases were highly competitive and generated record-setting bonus bid revenue for taxpayers.

• TotalEnergies New York Lease Termination
  • In February 2022, the New York Bight auction generated a record-breaking $4.37 billion in bonus bid revenue for taxpayers six leases covering 488,000 acres. One of the leases (Lease No. OCS-A 0538) was issued to Attentive Energy, a subsidiary of TotalEnergies. Attentive Energy acquired the lease with a bonus bid of $795 million, all of which DOI will now refund. This tract is expected to support approximately 1,545 megawatts (MW) of commercial offshore wind capacity. In September 2024, the project submitted its Construction and Operations Plan (COP) to the Bureau of Ocean Energy Management within DOI. To date, Attentive Energy has spent close to $500 million developing the lease.
• TotalEnergies North Carolina Lease Termination
  • In May 2022, the Carolina Long Bay auction brought in $315 million in bonus bid revenue across two leases covering 110,091 acres. One of the leases (Lease No. OCS-A 0545) was issued to TotalEnergies Renewables USA with a bonus bid of $160 million. TotalEnergies paid a deposit of $133.3 million toward the bid, which DOI will now fully refund. TotalEnergies anticipated the 54,937-acre project would come online by 2030, providing more than 1 gigawatt of electricity to the Southeast. To date, TotalEnergies has spent approximately $35 million developing the lease.

The highly competitive bids for these two leases, timely progress through the permitting process, and substantial financial investments in the projects demonstrate TotalEnergies' clear commitment to developing these leases. A company would not commit this level of capital unless it was confident the projects would generate strong financial returns, meaning significant electricity production for consumers and future revenue for taxpayers once the projects come online.

In exchange for buying back these leases, TotalEnergies will invest a combined $928 million in oil and gas projects, including:

• development of Trains 1 through 4 of the 29-million-ton-per-annum Rio Grande LNG plant in Texas  

• development of upstream conventional oil in the Gulf of America and of shale gas production

These investments will likely be made through TotalEnergies' U.S. affiliate, which owns an equity interest in Rio Grande LNG Intermediate Holdings through an equity cash call. Following TotalEnergies' $928 million investment in these projects, the DOI will terminate the leases and reimburse the company through the Department of Justice's Judgment Fund.

By cancelling competitive offshore wind leases, returning secured Treasury revenue, and effectively directing those funds be reinvested into oil and gas projects, the federal government is picking winners and losers in an energy market that is increasingly diversifying. True energy independence requires an "all of the above" strategy. Directing where the private industry should invest, and propping up one specific industry at the expense of another, threatens U.S. energy security and price stability and will ultimately cost taxpayers and consumers more down the road.