The U.S. wind energy sector faces a major roadblock as President Donald Trump halts federal permits and leasing for wind projects. Companies are delaying investments, while developers scramble for clarity on regulatory changes and tax incentives. The decision has disrupted investment plans, affecting both land-based and offshore developments.
Industry in Uncertainty as Federal Permits Stall
According to Enverus Intelligence Research, companies are now navigating regulatory uncertainty, with key projects placed on hold while awaiting government clarification.
One of the most immediate impacts has been on offshore wind projects, which already faced challenges due to rising costs and supply chain issues. TotalEnergies has postponed its offshore wind development plans for four years, while Shell recorded a $1 billion impairment, over half of which was tied to an offshore wind project.
Orsted, one of the largest offshore wind developers, has written down $1.7 billion from its U.S. portfolio and scaled back its capital investments by 25% through 2030.
Land-based wind projects, which constitute the majority of U.S. wind energy production, also face obstacles due to the complex permitting process.
Developers often require approvals from multiple federal agencies, including the Army Corps of Engineers, the U.S. Fish and Wildlife Service, and the Bureau of Land Management.
The Federal Aviation Administration also plays a role in approving turbine locations due to height and lighting regulations. The pause has left developers in limbo, with many seeking clarity on how existing projects will proceed.
Trump Policy Shift Threatens Long-Term Growth
Beyond permitting delays, Trump’s administration may also revise tax incentives that have played a crucial role in wind energy expansion. The 2022 Inflation Reduction Act (IRA), which provided tax credits for renewable energy projects, is under scrutiny, with Trump labelling it a “scam.”
According to industry analysts, developers accelerated work on projects before the end of 2024 to secure tax benefits, but future incentives remain uncertain.
The offshore wind industry, in particular, faces a difficult path. Rising interest rates, inflation, and supply chain disruptions have already inflated project costs.
Despite these challenges, around four gigawatts of offshore wind capacity remained under construction along the East Coast by the end of the third quarter, according to the American Clean Power Association.
Industry groups argue that maintaining policy stability is crucial to sustaining economic benefits linked to wind energy, including manufacturing and vessel support jobs in states such as Louisiana.
While Trump’s order includes a review of existing leases, the fate of projects such as the Lava Ridge Wind Project in Idaho remains uncertain. The project, previously approved in a scaled-down form by the Bureau of Land Management, is now under reassessment.
According to Idaho Senator Jim Risch, who advocated for halting the project, Trump shares concerns about its location and impact. Interior Secretary Doug Burgum is set to conduct a comprehensive review before a final decision is made.
