Morro Bay Offshore Wind Project Dead in Water After Company Ends Lease 

One of the offshore wind energy projects proposed off Morro Bay is now dead in the water.

Ocean Winds, which owns the Golden State Wind project off Morro Bay, voluntarily agreed to end its federal lease in a deal announced by the U.S. Department of the Interior on Monday, April 27. 

Under the agreement, the company can recover approximately $120 million in lease fees (out of the $150 million total) if it invests an equal amount in U.S. oil, gas, and energy infrastructure projects along the Gulf Coast. 

Golden State Wind has also decided not to pursue any new offshore wind projects in the United States, according to the announcement. 

Michael Brown, CEO of Ocean Winds North America, said in a statement that they did not take the decision lightly, but under current market conditions, receiving the refund for their lease payments was “the right outcome for our shareholders and partners.”

Santa Barbara Congressmember Salud Carbajal, who has fought tooth and nail to advance offshore wind development on the Central Coast, is “outraged,” according to a statement released Tuesday. He called the deal a “backwards decision” to “sabotage” the Morro Bay Wind Energy Area. 

Over a span of three years, Carbajal and his Offshore Wind Working Group — including federal, state, and local partners, such as the National Oceanic and Atmospheric Association and the Department of the Navy — identified potential lease areas and worked through complicated negotiations to create them, announcing the offerings in 2022. Since then, it’s been an increasingly rocky road to actually realizing the wind projects proposed for Morro Bay and other areas off the coast. 

While offshore wind has been lauded by many as a reliable, clean-energy source — and a promising addition to the job market — opponents have expressed concern over the potential impacts on marine life, the environment, fisheries, and recreation, manifesting in complex discussions with government agencies and the Northern Chumash tribe and lawsuits from San Luis Obispo fisheries. Building an offshore wind farm would take years of planning and implementation, from surveys and permitting to creating the necessary infrastructure to dredging up the site and installing the turbines. 

The turbines could have produced up to 2 gigawatts of electricity — enough to power more than 1.1 million homes off the Central Coast — and were planned for a site covering 80,418 acres about 22 miles from shore.

Carbajal said he championed the projects to strengthen energy security, boost local economic growth, and advance “important environmental protections.” 

He blamed President Donald Trump’s disdain for wind energy, originally sprouting from his fight with Scotland over a wind energy project near his golf courses there. Trump argued that the turbines “ruined the views.”

“Because of a bizarre personal vendetta against wind energy, Donald Trump’s administration is turning a historic opportunity into a historic failure,” Carbajal said. “Beyond the strategic failure of this policy decision, today’s announcement also represents a staggering waste of taxpayer dollars. I won’t let this extreme federal overreach and pressure go unchallenged, and I will continue to fight for the Central Coast’s right to build a greener economy.”

The Trump administration framed the deal as a shift away from “intermittent, higher-cost energy sources toward proven conventional solutions” — “conventional” meaning established operations such as natural gas. 

It’s all in the name of advancing Trump’s proclaimed “Energy Dominance Agenda,” according to the Department of the Interior’s announcement. The agreements announced this week match the conditions of a nearly $1 billion deal the Trump Administration struck with French energy company TotalEnergies in March to abandon two offshore wind projects in the Atlantic Ocean in exchange for investments in domestic fossil fuel projects. That deal is currently under investigation by Democratic members of Congress.

Ocean Winds and Global Infrastructure Partners also agreed to terminate another lease agreement, Bluepoint Wind off of New York. As part of the agreement, it will invest up to $765 million into a U.S.-based liquefied natural gas facility (the original bid amount for the Bluepoint Wind offshore wind project), and not pursue any future offshore wind developments, in exchange for reimbursement of the company’s bid payment, according to the announcement. 

“The companies that bid for these offshore wind leases were basically sold a product in 2022 that was only viable when propped up by massive taxpayer subsidies,” said Secretary of the Interior Doug Burgum in a statement. 

“Now that hardworking Americans are no longer footing the bill for expensive, unreliable, intermittent energy projects, companies are once again investing in affordable, reliable, secure energy infrastructure,” he continued. “We welcome each of the projects’ willingness to actually support baseload power and lower utility bills for American families. In addition, the agreements resolve the unaddressed national security concerns at both projects.”

In a post on X, California Governor Gavin Newsom begged to differ. “The Trump Administration AGAIN just gave companies almost A BILLION DOLLARS in taxpayer money to abandon clean energy projects and line Big Oil’s pockets,” he wrote. “Donald Trump is forcing Americans to pay more for energy and sabotaging our future.”

There are still two other lease sites off the Central Coast, held by Equinor and Invenergy, but in the current political climate, their future is uncertain. 

“I’ve got to tell you, it’s pretty damn frustrating when I hear and read about this administration’s approach to offshore wind, particularly off the coast of California,” California Senator Alex Padilla said directly to Secretary of the Interior Burgum directly during a hearing on Capitol Hill on Wednesday, April 29. “It makes no sense for an administration that wants to be energy dominant — as electricity prices are skyrocketing and demand growth is increasing — to pay developers to stop building energy projects that can add more electrons to the grid. Now, off the coast of California, it’s not just offshore wind opportunities. You’re seeking to now promote offshore drilling off the coast of California and elsewhere.”