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Introduction
By halting clean-energy projects, withdrawing from the Paris Agreement, and reviving fossil-fuel expansion, the Trump Administration has departed from prevailing international climate-policy trends. These actions raise profound legal questions about executive power while exposing the human and economic costs of job losses and disrupted investment reliance across the renewable energy sector. Nowhere are these consequences more visible than in the offshore-wind industry, which represents the nation’s “largest untapped clean energy resource”—capable of delivering gigawatts of reliable power directly to population centers along the Atlantic and Pacific coasts. Early evidence from operational sites like the South Fork Wind project off Long Island—which has exceeded production targets and delivered consistent power during peak demand—demonstrates the promise now imperiled by these policy reversals.
I. Overview of Federal Policy and Executive Actions
A. The Legacy of Federal Hostility Toward Wind Power
Trump’s opposition to wind power dates back to 2006—well before his first presidential term—when he began a years-long campaign against Scotland’s Aberdeen Offshore Wind Farm, claiming it would ruin ocean views and tourism. Although those early disputes unfolded overseas, they revealed a deeper skepticism toward wind-energy development that would later shape his domestic policy approach.
During his first term, the Trump Administration adopted a mixed stance toward offshore wind. Federal agencies such as the Bureau of Ocean Energy Management (BOEM) proceeded with several competitive lease sales—including a record-breaking 2018 auction off the coast of Massachusetts that generated approximately $405 million—signaling some degree of institutional support for the emerging industry. Yet the Administration’s broader energy agenda remained skeptical of renewable energy, as evidenced by its swift withdrawal from the Paris Agreement and its continued emphasis on fossil-fuel development through an “all-of-the-above” strategy that prioritized oil, gas, and coal expansion. This policy ambivalence left investors uncertain about the durability of federal support for offshore-wind projects and laid the groundwork for the far more aggressive rollback that would follow in 2025.
B. The 2025 Rollback and the Retrenchment of Offshore Wind Development
In his second term, President Trump has launched a sweeping rollback of offshore wind development, beginning with his January 20, 2025 Presidential Memorandum titled “Temporary Withdrawal of All Areas on the Outer Continental Shelf from Offshore Wind Leasing and Review of the Federal Government’s Leasing and Permitting Practices for Wind Projects.” The Memorandum withdrew all areas of the U.S. Outer Continental Shelf (OCS) from disposition for wind-energy leasing pursuant to the Outer Continental Shelf Lands Act (OCSLA), 43 U.S.C. § 1341(a). It further instructed federal agencies to pause the issuance of new or renewed approvals, rights-of-way, permits, leases, or loans for offshore wind projects pending a comprehensive review of federal leasing and permitting practices.
In parallel, the BOEM announced on July 30, 2025, that it would rescind all previously designated Wind Energy Areas (WEAs) on the OCS, thereby de-designating over 3.5 million acres of federal waters previously targeted for offshore wind development. This rescission followed a Department of the Interior Secretary’s Order (SO 3437) titled “Ending Preferential Treatment for Unreliable, Foreign Controlled Energy Sources in Department Decision-Making.” The combined effect of the Memorandum and BOEM action is to chill new leasing, suspend permitting, and complicate existing project pipelines by injecting regulatory uncertainty. These moves mark a comprehensive rollback of federal support for offshore wind—precisely at a time when many analysts expected acceleration.
On the fiscal front, on August 29, 2025, the Trump Administration canceled $679 million in federal funding for 12 offshore-wind projects across the United States. The funding cancellations spanned projects in California, Maryland, Massachusetts, and other states, signaling a stark shift in federal infrastructure priorities away from clean wind energy and toward traditional maritime and fossil-fuel investments.
II. Legal and Economic Consequences
A. State and Industry Pushback through Litigation
The Memorandum and subsequent agency actions prompted swift objections at the state level. Coastal states that had invested heavily in offshore-wind infrastructure—and tied clean-energy and job-growth strategies thereto—issued statements urging adherence to existing leases and federal approvals. For example, multiple governors from Rhode Island, Massachusetts, Connecticut, New York, and New Jersey collectively cautioned that abrupt policy reversals undermine not only state clean-energy goals but also public trust and private reliance. In addition to public opposition, some of these states—notably Rhode Island and Connecticut—have initiated or joined litigation challenging the federal cancellations, seeking to preserve regulatory stability and protect billions in planned investment. Their claims primarily allege violations of the Administrative Procedure Act (APA), 5 U.S.C. § 706, arguing that the federal government acted arbitrarily and capriciously by failing to provide a reasoned justification for reversing established policy.
This wave of state-led challenges was soon mirrored by private industry. Supported by several state governments, offshore-wind developers—including Ørsted, a Danish energy company, and US Wind, based in Maryland—filed or intervened in related actions seeking to block the Administration’s cancellations. Their claims likewise rest on the APA’s arbitrary-and-capricious standard and on arguments that the federal government exceeded its statutory authority under the OCSLA by halting projects that had already received valid leases and permits. These legal battles set the stage for the next—and more immediate—consequence of the federal reversals: widespread economic disruption across the offshore-wind sector.
B. Market Shock and the Collapse of Investor Confidence
The economic consequences of the Administration’s offshore wind policy have been immediate and far-reaching. The cancellation of $679 million in federal funding has disrupted active projects, port expansions, and supply-chain development, placing more than 17,000 offshore-wind jobs at risk. The impact extends beyond U.S. borders: Ørsted, the world’s largest offshore-wind developer, announced plans to cut roughly 2,000 jobs—about one-quarter of its global workforce—by 2027, citing uncertainty in the U.S. market.
At the same time, renewable-energy investment in the U.S. has fallen sharply. Capital inflows to the sector fell by over 36 percent in the first half of 2025 compared with the prior six months, reflecting mounting investor concern over the federal government’s commitment to clean-energy policy. Offshore-wind development, in particular, depends on long-lead, capital-intensive investments—manufacturing turbines, fabricating foundations, upgrading ports, and building specialized vessels. The federal leasing freeze and funding withdrawals have eroded investor confidence, increased financing risk, and raised the cost of capital, threatening to strand billions already committed to the domestic supply chain.
III. The Road Ahead
A. Litigation and Resilience in the Wake of Ørsted’s Injunction
“When you’re trying to shut down an industry, it cuts people the wrong way and they are going to fight for it,” said Vincent DeVito, who served as an energy czar for Ryan Zinke, President Trump’s first Interior Secretary. That prediction materialized in a landmark ruling on September 22, 2025, when the U.S. District Court for the District of Columbia granted Ørsted’s motion for a preliminary injunction, lifting the Trump Administration’s halt on the Revolution Wind project and allowing construction to resume. The court found that Ørsted was “likely to suffer irreparable harm in the absence of an injunction,” emphasizing the company’s substantial financial commitments and reliance on prior federal approvals. This ruling represents a legal setback for the Administration, demonstrating that challenging federal actions in court can effectively protect renewable energy projects.
For offshore-wind advocates, this litigation represents an important blueprint for resistance: where reliance interests are well-established, federal approvals secured, and industry investment significantly advanced, courts may be willing to grant relief even in the face of executive reversal. Although the decision addressed only a preliminary injunction rather than the case’s merits, it nevertheless signals a growing judicial recognition of the stability and legitimacy of the clean-energy transition—a reminder that progress, though slowed, remains legally and politically resilient.
B. Social and Environmental Costs of Federal Retrenchment
Beyond their economic and legal dimensions, the federal cancellations have generated profound and enduring social and environmental consequences. Socially, the offshore-wind freeze is not simply a budgetary adjustment or a shift in administrative priorities—it represents a disruption of livelihoods and communities. The rollback has tangible human costs: construction workers, engineers, port operators, and supply-chain manufacturers across coastal states now face widespread uncertainty as projects are paused or terminated. In regions where offshore wind had begun to anchor local economies and workforce development, the cancellations have created a sense of instability and disillusionment.
Environmentally, the delays in offshore-wind deployment threaten to exacerbate climate change impacts and further distance the U.S. from its renewable-energy and emissions-reduction targets. Analysts emphasize that wind power remains one of the most cost-effective sources of new electricity generation, and that a slowdown in deployment will likely raise energy costs for U.S. households while deepening reliance on fossil fuels. In New England, the grid operator ISO–New England has cautioned that canceling major offshore-wind projects could lead to capacity shortages—underscoring that federal policy reversals can reverberate beyond national decarbonization goals to threaten regional energy security and economic stability.
Conclusion
The 2025 rollback—an upstream leasing freeze coupled with a downstream funding withdrawal—marks a significant reversal in the U.S. clean-energy transition. Once a pillar of U.S. decarbonization strategy, offshore wind now stands at the center of political and legal uncertainty, its promise of clean power, jobs, and energy security undermined by regulatory volatility. While litigation continues, the damage is already evident. The convergence of lease freezes, permit pauses, and funding cuts has dealt a triple blow: stalled projects, eroded investor confidence, and widespread job losses. These setbacks ripple through communities and ecosystems alike, slowing climate progress and deepening regional inequities.
Ultimately, this retrenchment exposes the fragility of the U.S. energy transition when climate ambition collides with political volatility. Durable decarbonization requires more than short-term incentives or shifting rhetoric—it demands regulatory stability, federal–state coordination, and sustained commitment beyond electoral cycles. Only through such continuity can the United States restore investor confidence, reclaim leadership in the global energy transition, and allow offshore wind to realize its original promise: a catalyst for resilient, equitable, and enduring clean-energy growth.
Suggested Citation: Yejoo Moon, Offshore Wind Under Siege: Policy, Litigation, and the Cost of Federal Cancellations, Cornell J.L. & Pub. Pol’y, The Issue Spotter (Dec. 4, 2025), https://publications.lawschool.cornell.edu/jlpp/2025/12/04/offshore-wind-under-siege-policy-litigation-and-the-cost-of-federal-cancellations/.
About the Author
Yejoo Moon is a second-year law student at Cornell Law School. She earned her MA in International Relations from the University of St Andrews and also studied Political Science at the University of California, San Diego. At Cornell, she serves as an associate for the Journal of Law and Public Policy and is a student attorney in the Gender Justice Clinic. Outside of law school, she enjoys hiking, painting, and going grocery shopping.