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Texas Blocks Chinese Wind Farm Investment Approved by CFIUS

A company owned by a Chinese billionaire is suing a Texas-based independent power operator for blocking its investment under state law, despite the federal government's Committee on Foreign Investment in the United States (CFIUS) approving that investment, Nikkei Asia reports.

China's Xinjiang Guanghui Industry Investment Group's subsidiary, GH America Energy, accuses The Electric Reliability Council of Texas (ERCOT) of illegally blocking its wind farm project in 2022 by relying on the state's Lone Star Infrastructure Protection Act. Under the Act, "companies controlled by Chinese, North Korean, Iranian and Russian nationals" cannot obtain "access to the state's critical infrastructure on security grounds." GH America Energy argues that despite complying with state law, ERCOT has breached the U.S. Constitution's supremacy clause, which establishes that federal laws take precedence over state laws. It also argues that the state law violates the principle of equal protection and that the blockage has inflicted monetary damages on the company.