California's attorney general announced today that his office and the state's energy commission intend to sue the federal government over a $1.22 billion agreement to pay an energy company to abandon offshore wind development leases, according to a notice of intent filed with the U.S. Department of Interior.
The agreement, between the Department of Interior and RWE U.S. Offshore, would require the company to cancel three offshore wind leases in federal waters off California, Louisiana, and New York. In exchange, the federal government would pay $1.22 billion in taxpayer funds, which RWE would then use to invest in out-of-state natural gas projects instead, the state says.
California argues the deal violates the Outer Continental Shelf Lands Act because it gives the state insufficient authority over federal leasing decisions affecting its coast. The state has invested more than $100 million to prepare its ports and transmission infrastructure to support offshore wind energy and holds a strategic goal of developing 25 gigawatts of offshore wind capacity by 2045, enough to power roughly 25 million homes and supply about 13 percent of the state's electricity, according to the energy commission.
The state alleges the agreement would undermine that effort and strand prior investments in port infrastructure and related industries. It provided a 60-day window for the federal government and RWE to address the violations before the state files suit.