N.J.’s long-awaited pilot meets new doubts from rate counsel

Source: David Iaconangelo, E&E News reporter • Posted: Thursday, November 1, 2018

A proposal for a small wind pilot project off the coast of Atlantic City could be due for a reshaping by its developers, with New Jersey regulators postponing a vote of final approval into the winter.

The three-turbine Nautilus project was, until recently, a symbol of dashed hopes for the industry, having languished under former Gov. Chris Christie (R). In May, Democratic Gov. Phil Murphy revived the project and dropped it into the fast track for approval, signing a bill calling on the Board of Public Utilities (BPU) to approve a project of up to 25 megawatts “in territorial waters offshore of a municipality in which casino gaming is authorized.”

But earlier this month, the state’s Division of Rate Counsel, which acts as consumer advocate for utility ratepayers, submitted a filing to the BPU recommending that it reject the proposal.

A spokesperson for the developers expressed confidence that the project’s timeline would not be affected, saying the Rate Counsel’s objections would be a starting point for negotiations with the BPU and noting that the Rate Counsel had supported past iterations of the project.

It has slowed the project’s momentum, though: The BPU’s ruling, originally slated for Monday, was put off until Dec. 18 “[a]t the request of the petitioner,” said Peter Peretzman, spokesman for the agency.

A trial run for offshore

Fishermen’s Energy LLC, the historic developer of the pilot, and its new partner EDF Renewables have touted Nautilus as a way for the state’s workforce and policymakers to get experience on a modest series of turbines before they move onto commercial-scale jobs.

The argument is as old as the project, which was proposed a decade ago, and has lost its powers of persuasion for some environmentalists, who would rather the state take bigger strides toward the governor’s goal to have 3,500 megawatts of offshore wind by 2030.

The Division of Rate Counsel appears to concur.

In an Oct. 2 filing, Louisiana State University energy economist David Dismukes argued that other states with offshore ambitions were skipping demonstrations and heading straight into utility-scale development.

Dismukes, hired as a consultant by the Rate Counsel, noted that to reach the 3,500-MW goal, the state would need to develop an average of 300 MW per year.

The companies’ proposal “distracts from the governor’s goals,” he concluded, and would lead to more costs than benefits for ratepayers in the state.

“Any small-scale project approved for development in New Jersey will just be pulling resources and opportunities away from the large-scale development intended” by the governor and the BPU, wrote Dismukes.