Backers of offshore wind power push N.J. to follow through on creating policy

Source: Camille von Kaenel, E&E reporter • Posted: Thursday, October 1, 2015

New Jersey still has not fully developed a mechanism to get power from offshore wind turbines to the electricity market, but developers, state lawmakers and the federal government are all backing a new push to establish the offshore wind industry there.

Backers of offshore wind in the state have had to confront legal challenges and lukewarm political support. In the United States, the offshore wind industry has suffered major setbacks in the past. But several recent moves have fueled hopes that the industry might pick up again to catch up with Europe’s thriving offshore wind market (ClimateWire, Sept. 28). This summer saw the start of construction on what is expected to become the first offshore wind farm off the coast of Rhode Island by Deepwater Wind LLC. Maryland, New York and Massachusetts have set up more supportive state policies.

And recently, the Bureau of Ocean Energy Management (BOEM) announced it will hold a competitive auction in November to sell two lease areas in federal waters off New Jersey’s coast for use by offshore wind developers (E&ENews PM, Sept. 23).

The move came despite the failure of state regulators to establish a program requiring utilities to buy power generated from offshore wind farms. Five years ago, a law signed by New Jersey Gov. Chris Christie (R), called the Offshore Wind Economic Development Act (OWEDA), promised a system of offshore renewable energy certificates (ORECs) to boost offshore wind projects. The lag in implementation has been singled out as a barrier to development in the state.

But BOEM decided to sell the leases, hoping that the system will come to fruition soon, said BOEM Director Abigail Hopper.

“We think there are valuable resources [in the lease areas], and we think there is industry interest in it,” she said. “The aligning of state policy and federal lease timetables is not a new challenge. I don’t think we have the perfect answer yet, but we’re showing leadership on federal side to move forward, and I’m hopeful we’ll encourage the state regulators to move forward on their side.”

Congressmen pressure Gov. Christie

Critics of Christie have said his initial enthusiasm for offshore wind in the state has waned as his presidential candidacy has picked up steam.

Yesterday, Democratic Sens. Bob Menendez and Cory Booker and Rep. Frank Pallone called on the governor to take his cue from the federal government and follow through on the law.

“Offshore wind has incredible potential to spur new manufacturing in New Jersey, create good-paying jobs, and provide our residents with a clean, affordable, and abundant source of power,” their letter says. “We encourage your Administration to move as quickly as possible to fully implement OWEDA, to ensure a clear and robust State policy to complement the efforts of the federal government.”

This week, New Jersey’s Board of Public Utilities reached out to consultants to help finalize the OREC implementation plan, said Hopper. Christie’s office and the Board of Public Utilities could not be reached for comment in time for publication.

One of the companies planning to bid on the leases on Nov. 9 is Fishermen’s Energy, its general counsel and chief operating officer, Paul Gallagher, confirmed. The firm has battled the Board of Public Utilities over its proposed project off Atlantic City, which the board has repeatedly rejected, citing high costs (ClimateWire, June 1).

“We think that the state, which has made it publicly known they were waiting for BOEM to move first, now is in a position where it’s time for them to move,” he said.

Other offshore wind developers, including Deepwater Wind and OffshoreMW LLC, said they remained wary of the lack of political will in the state, without specifying whether they planned to bid on the leases or not.

Though the New Jersey system has not yet been completed, Massachusetts now has a similar certificate program for offshore wind projects in place. Knowing the OREC system exists has allowed Italy-based developer U.S. Wind Inc. to move forward on its plans to construct offshore wind farms there, said Paul Rich, the firm’s project manager for Maryland.

“It can be done, there’s no reason New Jersey can’t do it, and if they can’t do it, they should look at Maryland and copy it,” Gallagher said.