Christopher Niezrecki, UMass Lowell; Ben Link, Johns Hopkins University, and Zoe Getman-Pickering, UMass Amherst

The U.S. is in a bizarre situation in 2026: It’s facing a looming energy shortage, yet the Trump administration is making deals to pay offshore wind developers nearly US$2 billion in taxpayer money to walk away from energy projects.

These politically motivated moves are costing Americans far more than just the buyouts.

Communities have been laying the groundwork for offshore energy projects for years. Offshore wind development brings jobs and economic development that reshape regional economies, with the scale of public and private investment reaching into the hundreds of billions of dollars over years. East Coast communities have built up ports to support the industry and launched job-training programs to prepare workers. Construction, maintenance and shipping businesses have sprung up, along with secondary businesses that support the industry.

Losing the projects, and the threat of losing other planned wind farms, will also likely mean higher energy prices. And while some offshore wind farms are moving ahead, developers must account for both lost momentum and increased uncertainty from the Trump administration.

As a result, Americans will bear the economic brunt of these decisions for decades ahead.

How America got to this point

To understand how the U.S. arrived in this predicament, let’s take a step back.

In March 2023, leaders from three U.S. federal agencies under the Biden administration met with the CEOs from American technology and manufacturing giants Microsoft, Amazon, Ford, GM, Dow Chemical and GE at the annual ARPA-E Energy Innovation Summit, under the banner of “Affordable, Reliable and Secure American-Made Energy”.

They agreed on a key point: The nation was staring down a severe shortage of electrons to drive American business forward.

Fortunately, solutions abounded. Enormous amounts of onshore wind and solar power had been deployed during the previous five years. More than 80% of all new power additions to the U.S. grid had come from these two sources.

Particularly exciting were plans to build large offshore wind farms up and down the Eastern Seaboard. Taken together, the wind farms would generate 30 gigawatts of new power by 2030, enough to power more than 10 million homes and reduce volatility in energy pricing thanks to long-term power purchase agreements.

The U.S. had one small wind farm at the time, off Rhode Island, and two wind turbines off Virginia, but Europe had been operating large offshore wind projects for over two decades and was building more.

In the months following the 2023 meeting, leasing and permitting for the U.S. mega projects continued, and in some areas construction got underway.

Then, the Trump administration arrived in 2025. As president, Donald Trump immediately issued an executive order to halt offshore wind lease sales and any approvals, permits or loans for wind farms. He had made his disdain for wind power clear ever since he lost a fight to stop construction of a small wind farm near his golf course in Scotland in the 2010s.

After a federal judge declared Trump’s executive order unconstitutional in December 2025, the administration shifted strategies.

In March 2026, news outlets began reporting on deals struck in which the federal government would pay three offshore wind project developers hundreds of millions of dollars to cease development of their permitted projects, agree not to build others and repurpose the funds toward fossil fuel projects.

According to reported discussions involving the French energy company TotalEnergies, the money would be paid out through the Department of Interior’s Judgment Fund, intended for payment of legal settlements, despite there not being any active litigation with TotalEnergies.

The other projects agreeing to Trump’s buyouts as of early May were Golden State Wind, in California, and Bluepoint Wind, off New Jersey and New York. Both are co-owned by Ocean Winds, a joint venture of the French energy company Engie and EDP Renewables, headquartered in Spain. The California Energy Commission and members of Congress are now investigating the moves.

Offshore wind means local investment

Regardless of whether these buyouts are even legal, the losing parties will be the American taxpayers and a U.S. economy that needs more electrons on the grid, not fewer.

One analysis projected that deploying 40 GW along the U.S. East Coast by 2035 would generate roughly $140 billion in investment, much of it concentrated in port infrastructure and supply chain development.

New York in early 2026 announced a $300 million state grant program to expand port infrastructure supporting offshore wind. And the New Jersey Wind Port represents an investment exceeding $600 million to enable manufacturing and assembly of turbines.

In 2025, California state lawmakers authorized $225.7 million in spending for offshore wind ports and related facilities.

For these projects to pay off for local communities, however, the regions will need to see the development of wind farms.

Killing jobs

The cancellations of the planned projects also take jobs away from hard-working, blue-collar Americans.

The construction and installation of offshore wind turbines requires the expertise of skilled electrical workers, pipe fitters, welders, pile drivers, iron workers, machinists and carpenters.

Future offshore wind costs depend on investments today. As infrastructure is established and expertise grows, each subsequent project becomes easier to build, less risky and less expensive.

This pattern is already evident globally: The levelized cost of electricity from offshore wind globally fell by 62% between 2010 and 2024.

Canceling projects or buying back leases eliminates the electricity those projects would have generated. It also slows the accumulation of experience, scale and supply chain maturity that drive costs down over time.

The result is higher costs for future projects and for electricity ratepayers.

An energy crisis

Developing a robust offshore wind industry provides resilience in the face of an unstable global energy market.

Future U.S. and global energy demand is projected to grow significantly, largely driven by the rapid expansion of AI data centers and electrification of vehicles, homes and businesses.

Limiting the supply of homegrown energy will increase energy costs for Americans, especially in the regions where the wind farms were supposed to be located – New York, New Jersey, North Carolina and California.

With the federal buyouts, the U.S. is losing 8 GW of planned electricity generation, enough to power more than 3 million homes. That generation needs to be replaced by other energy sources and expanding power transmission lines that can take seven to 10 years to get permits for and build out. The leased projects were on their way to providing new clean power generation fairly quickly. Eliminating them restarts the project clock.

Reliance on dirtier, conventional forms of power generation will increase along with foreign energy imports, such as electricity delivered from Canada to New York, leading to higher and more volatile electricity prices.

Evidence from Europe shows that offshore wind can also reduce electricity costs for consumers by lowering wholesale prices and reducing dependence on fossil fuels and their volatile prices.

Vineyard Wind I, an offshore wind farm completed in 2026, with 806 MW of generation – enough to power about 400,000 homes – is projected to save Massachusetts customers about $1.4 billion on electricity bills over the next 20 years. With a fixed-price, 20-year contract, the project also lowered prices during cold snaps and peak demand for gas, reducing volatility and cost.

From jobs to local economic development to power costs, we believe canceling these offshore wind projects is a bad deal for American taxpayers.

Christopher Niezrecki, Director of the Center for Energy Innovation, UMass Lowell; Ben Link, Deputy Director of the Ralph O’Connor Sustainable Energy Institute, Johns Hopkins University, and Zoe Getman-Pickering, Program Director of the Academic Center for Reliability and Resilience of Offshore Wind, UMass Amherst

This article is republished from The Conversation under a Creative Commons license. Read the original article.