California Attorney General Rob Bonta and the California Energy Commission have filed a federal lawsuit challenging a US Department of the Interior agreement that canceled a planned 2-gigawatt floating offshore wind project off the state’s Central Coast.

As reported by Reuters, the suit names the US Department of the Interior and Golden State Wind LLC as defendants. The lawsuit was filed in the US District Court for the Northern District of California (California v. Department of the Interior, No. 3:26-cv-09123) on August 28, 2026.

Golden State Wind is a joint venture between Ocean Winds — itself a 50/50 partnership of France’s ENGIE and Portugal’s EDP Renewables — and Reventus Power.

Golden State Wind acquired the roughly 80,000-acre lease in the Morro Bay Wind Energy Area in a 2022 federal auction for $120 million. The project was slated to generate enough electricity for more than 1 million homes and included more than $30 million in pledged commitments for workforce training, supply-chain development, and community benefits, including support for fishing communities.

In late April 2026, Interior had announced a deal under which Golden State Wind would voluntarily relinquish the lease. In return, the company would become eligible to recover approximately $120 million in lease fees after investing an equivalent amount in US oil and gas assets, energy infrastructure, or liquefied natural gas projects along the Gulf Coast. Interior described the arrangement as settling litigation; California contends no such lawsuit existed.

The state of California is arguing that the agreement violates the Outer Continental Shelf Lands Act by failing to follow required procedures for lease cancellation or relinquishment, including a hearing, a five-year suspension period, coordination with the California governor, and applicable regulations. The state also alleges the $120 million payment violates the Judgment Fund Act because it was not made to resolve an existing lawsuit.

Officials say the cancellation threatens more than $100 million in state investments in port upgrades, transmission planning, and supply-chain preparation, as well as thousands of potential jobs. Broader offshore-wind buyouts, they warn, could put nearly 175,000 jobs at risk statewide. California has set a target of 25 gigawatts of offshore wind by 2045.

The state first sent a 60-day notice of intent to sue on June 23, 2026, after opening an investigation and issuing an administrative subpoena to Golden State Wind in May. The lawsuit asks the court to invalidate the agreement and block its implementation.

Golden State Wind and Ocean Winds did not immediately comment in coverage of the filing. The case is one of multiple legal actions California has brought against the federal government since early 2025.